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Hochschild Mining PLC (GB:HOC)
LSE:HOC

Hochschild Mining (HOC) AI Stock Analysis

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GB

Hochschild Mining

(LSE:HOC)

Rating:76Outperform
Price Target:
352.00p
▲(12.97%Upside)
Hochschild Mining's strong technical momentum and positive earnings call sentiment significantly contribute to the overall score. Financial performance shows improvement, although valuation and cash flow constraints limit upside potential. The company's strategic initiatives and strong operational results further bolster the outlook.

Hochschild Mining (HOC) vs. iShares MSCI United Kingdom ETF (EWC)

Hochschild Mining Business Overview & Revenue Model

Company DescriptionHochschild Mining plc, a precious metals company, engages in the exploration, mining, processing, and sale of gold and silver in the Americas. It holds 100% interests in the Inmaculada gold/silver underground operation and Pallancata silver/gold property, which are located in the Department of Ayacucho in southern Peru. The company also holds a 51% interest in the San Jose silver/gold mine located in Argentina. In addition, it has a portfolio of projects located across Peru, Argentina, Mexico, United States, Canada, Brazil, and Chile. Further, the company is involved in the power generation and sales business. Hochschild Mining plc was founded in 1911 and is based in London, the United Kingdom.
How the Company Makes MoneyHochschild Mining generates revenue through the exploration, extraction, and sale of precious metals, primarily silver and gold. The company's key revenue streams include the production and direct sale of these metals to the global market, where they are used in various industries, including electronics, jewelry, and investment. Hochschild achieves value by efficiently operating its mines, focusing on cost control and maximizing the output of high-quality ore. The company's earnings are also influenced by global precious metals prices, which can fluctuate based on market demand, geopolitical factors, and economic conditions. Additionally, Hochschild may engage in strategic partnerships or joint ventures to enhance its exploration capabilities and expand its resource base.

Hochschild Mining Earnings Call Summary

Earnings Call Date:Mar 12, 2025
(Q4-2024)
|
% Change Since: 63.27%|
Next Earnings Date:Aug 13, 2025
Earnings Call Sentiment Positive
The earnings call highlighted record-breaking results, significant resource additions, and successful debt reduction and dividend restoration. However, these were countered by cost increases, FX losses, and challenges in Argentina. Despite these challenges, the overall sentiment remains positive due to strong operational and financial achievements.
Q4-2024 Updates
Positive Updates
Record-Breaking Results
The company achieved the best results in 13 years, producing nearly 350,000 ounces of gold and nearly reaching $1 billion in revenue, with EBITDA increasing by 54%.
Significant Resource Addition
The company added 2.8 million ounces of resources, with notable additions in Inmaculada (1 million ounces) and Royropata (1.3 million ounces).
Debt Reduction and Dividend Restoration
The company reduced net debt by $40 million, finishing at $216 million, and reinstated dividends with a policy based on 20%-30% of free cash flow.
Strong Cash Generation
Inmaculada alone generated $192 million in cash, contributing to a strong cash position of $97 million.
M&A and Divestments
Executed acquisition of Monte do Carmo for $60 million and divested three non-core assets, receiving $60 million in cash.
ESG and Operational Efficiency
Maintained world-class ESG performance with a frequency rate of 1 for underground mines and implemented cost efficiency projects across operations.
Negative Updates
Cost Increases
Costs increased by 19% due to increased production volume and inflation, particularly in Argentina.
FX Losses
Recorded foreign exchange losses mainly due to the devaluation of the Argentinian peso and Brazilian real.
Higher All-In Sustaining Costs
Reported slightly higher all-in sustaining costs due to a slower ramp-up in Mara Rosa and inflationary pressures.
Challenges in Argentina
Incurred a 33% effective tax rate and faced challenges in repatriating cash from Argentina.
Delay in Royropata Permit
The permit for Royropata is expected by 2027, due to the lengthy process of obtaining easements and government approvals.
Company Guidance
During the call discussing the fiscal year 2024 results, Eduardo Landin outlined the company's strategic focus on four pillars: brownfield development for long-term value and mine life extension, operational efficiency, enhanced ESG (Environmental, Social, and Governance) practices, and disciplined capital allocation. The company achieved its best results in 13 years, producing nearly 350,000 ounces of gold, generating revenues close to $1 billion, and increasing EBITDA by 54%. They also reduced their net debt to $216 million after repaying $40 million of debt, and reinstated their dividend policy. For 2025, the company forecasts production between 350,000 and 378,000 ounces, with the first full production year at Mara Rosa and key developments at Royropata and Monte do Carmo. They also aim to maintain strong ESG metrics and reduce costs through various initiatives. The company secured a new $300 million green loan and announced a dividend policy, aiming to pay 20% to 30% of free cash flow, with a minimum of $10 million annually. The call also addressed cost increases due to a 19% rise in production volume and inflationary pressures, while highlighting ongoing cost optimization projects and the potential for future growth through the development of core assets.

Hochschild Mining Financial Statement Overview

Summary
Hochschild Mining demonstrated strong revenue growth and operational efficiency in 2024. The balance sheet reflects stable leverage and improving equity, though historical fluctuations in profitability and cash flow are present. Despite positive cash flow growth, capital expenditures weigh on cash reserves.
Income Statement
75
Positive
Hochschild Mining demonstrated strong revenue growth from 2023 to 2024, with a 36.6% increase, driven by the mining sector's improving conditions. The company improved its gross profit margin from 26.7% in 2023 to 36.1% in 2024, showcasing enhanced operational efficiency. However, the absence of EBIT and fluctuating net profitability, with a net profit margin rising to 10.2% in 2024 from a negative margin in 2023, indicates volatility in core earnings.
Balance Sheet
70
Positive
The company maintains a reasonable debt-to-equity ratio of 0.52 in 2024, indicating balanced leverage. The equity ratio improved to 37.0%, reflecting a solid capital structure. However, the return on equity, which increased to 15.9% in 2024, signals improved profitability but also highlights past fluctuations due to inconsistent earnings.
Cash Flow
68
Positive
Operating cash flow growth was robust, increasing to $321 million in 2024, supporting liquidity. The free cash flow turned positive in 2024, after being negative in the prior year, indicating improved cash generation. Nonetheless, significant capital expenditures continue to weigh on cash reserves, and the free cash flow to net income ratio remains modest.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
771.43M947.70M693.72M735.64M811.39M621.83M
Gross Profit
265.47M342.43M185.50M208.00M299.80M195.07M
EBIT
120.36M0.00-7.67M35.89M161.16M82.39M
EBITDA
304.63M359.10M117.38M177.74M296.02M188.72M
Net Income Common Stockholders
29.23M97.00M-55.01M4.83M76.93M20.43M
Balance SheetCash, Cash Equivalents and Short-Term Investments
542.32M100.78M89.13M143.84M386.79M231.88M
Total Assets
1.66B1.65B1.42B1.42B1.45B1.37B
Total Debt
317.65M319.31M351.16M321.87M304.91M210.95M
Net Debt
-207.83M222.33M262.03M178.02M-81.88M-20.93M
Total Liabilities
609.19M964.15M747.23M694.57M695.27M559.98M
Stockholders Equity
908.11M610.87M608.46M657.24M695.55M726.53M
Cash FlowFree Cash Flow
-57.51M32.57M-83.62M-230.79M132.34M88.04M
Operating Cash Flow
193.18M321.25M178.76M102.92M284.70M195.37M
Investing Cash Flow
-223.20M-277.00M-245.51M-337.58M-183.43M-112.23M
Financing Cash Flow
34.75M-34.82M22.77M-6.59M57.13M-12.41M

Hochschild Mining Technical Analysis

Technical Analysis Sentiment
Positive
Last Price311.60
Price Trends
50DMA
277.45
Positive
100DMA
238.43
Positive
200DMA
222.02
Positive
Market Momentum
MACD
4.39
Negative
RSI
66.36
Neutral
STOCH
75.50
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:HOC, the sentiment is Positive. The current price of 311.6 is above the 20-day moving average (MA) of 278.75, above the 50-day MA of 277.45, and above the 200-day MA of 222.02, indicating a bullish trend. The MACD of 4.39 indicates Negative momentum. The RSI at 66.36 is Neutral, neither overbought nor oversold. The STOCH value of 75.50 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:HOC.

Hochschild Mining Peers Comparison

Overall Rating
UnderperformOutperform
Sector (51)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
GBSRB
82
Outperform
£155.42M4.9930.73%42.36%270.33%
GBHOC
76
Outperform
£1.47B21.1115.70%0.47%31.84%
51
Neutral
$2.02B-1.12-21.36%3.65%2.87%-30.54%
GBAAZ
£168.51M-22.65%
GBGGP
49
Neutral
£1.92B366.503.19%
GBMTL
£223.76M11.7819.64%
GBPAF
76
Outperform
£987.26M14.7821.65%1.97%0.07%6.71%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:HOC
Hochschild Mining
302.40
122.30
67.91%
GB:AAZ
Anglo Asian Mining
163.00
97.00
146.97%
GB:GGP
Greatland Gold
14.66
7.15
95.21%
GB:MTL
Metals Exploration
8.60
4.90
132.43%
GB:PAF
Pan African Resources
46.50
23.29
100.34%
GB:SRB
Serabi Gold
169.00
97.50
136.36%

Hochschild Mining Corporate Events

Executive/Board ChangesBusiness Operations and Strategy
Hochschild Mining Announces COO Resignation Amidst Brazilian Reorganization
Neutral
May 27, 2025

Hochschild Mining PLC announced the resignation of Rodrigo Nunes as Chief Operating Officer, with CEO Eduardo Landin temporarily assuming operational responsibilities. This management change is part of a broader reorganization of the company’s Brazilian operations, which includes interim management appointments, potentially impacting operational efficiency and strategic direction.

The most recent analyst rating on (GB:HOC) stock is a Buy with a £260.00 price target. To see the full list of analyst forecasts on Hochschild Mining stock, see the GB:HOC Stock Forecast page.

Shareholder MeetingsDividends
Hochschild Mining Announces 2024 Final Dividend Exchange Rate
Positive
May 12, 2025

Hochschild Mining PLC has announced the exchange rate for its proposed 2024 final dividend, set at US$1:£0.7496, resulting in a sterling equivalent of 1.457 pence per Ordinary Share. This dividend is scheduled for payment on 18 June 2025, pending shareholder approval at the upcoming Annual General Meeting, reflecting the company’s commitment to returning value to its shareholders.

Other
Hochschild Mining CEO Increases Stake in Company
Positive
Apr 25, 2025

Hochschild Mining PLC announced a change in the shareholding of its CEO, Eduardo Landin, following the partial vesting of a Long-Term Incentive Plan award. Landin acquired 77,000 ordinary shares at an average price of £2.7222 per share, bringing his total holding to 580,200 shares, which represents 0.113% of the company’s issued share capital. This transaction, conducted on the London Stock Exchange, highlights the CEO’s increased stake in the company, potentially signaling confidence in its future performance.

Business Operations and StrategyFinancial Disclosures
Hochschild Mining Maintains 2025 Guidance Amid Operational Challenges
Neutral
Apr 23, 2025

Hochschild Mining reported its Q1 2025 production results, highlighting a solid performance at its Inmaculada mine and challenges at the Mara Rosa operation due to adverse weather and contractor issues. Despite these challenges, the company maintains its full-year production guidance and anticipates a recovery in the second half of the year. The easing of exchange controls in Argentina is expected to improve cost positions, while the company continues to streamline its portfolio by selling non-core assets. Hochschild also reported improvements in safety metrics and environmental performance, reflecting its ongoing commitment to ESG principles.

Business Operations and Strategy
Hochschild Mining Partners with Smithsonian for Biodiversity at Inmaculada Mine
Positive
Apr 14, 2025

Hochschild Mining PLC has partnered with the Smithsonian’s Center for Conservation and Sustainability to conduct biodiversity studies at its Inmaculada mine in southern Peru. This collaboration aims to integrate biodiversity conservation with the mine’s operations, ensuring sustainable environmental practices following the mine’s recent 20-year environmental permit extension.

Shareholder MeetingsFinancial Disclosures
Hochschild Mining Releases 2024 Annual Report and AGM Details
Neutral
Apr 11, 2025

Hochschild Mining PLC has published its 2024 Annual Report and Accounts, following the announcement of its full-year results. The documents, including the shareholder circular and notice of the Annual General Meeting (AGM), are available on the company’s website and the National Storage Mechanism. The AGM is scheduled for June 12, 2025, in London, with shareholders encouraged to appoint the Company Chair as their proxy to ensure their votes are counted. This announcement highlights the company’s commitment to transparency and stakeholder engagement, providing detailed financial insights and operational updates.

Executive/Board ChangesBusiness Operations and Strategy
Hochschild Mining Announces New Director Appointment
Positive
Apr 2, 2025

Hochschild Mining PLC announced the appointment of Joanna Pearson, an Independent Non-Executive Director, as a Non-Executive Director of Rupert Resources Ltd., a company listed on the TSX. This strategic move could enhance Hochschild’s industry positioning by potentially fostering new partnerships and expanding its influence in the mining sector.

DividendsBusiness Operations and StrategyFinancial Disclosures
Hochschild Mining Reports Record Financial Performance and Strategic Growth
Positive
Mar 12, 2025

Hochschild Mining PLC announced its strongest financial performance in 13 years, with significant increases in revenue, adjusted EBITDA, and profit before tax. The company is expanding its resources with record additions and developing major growth projects to boost production, while also restoring its dividend policy to enhance shareholder value. The company’s strategic advancements in Brazil and resource additions in Peru highlight its commitment to growth and sustainability, ensuring long-term value for stakeholders.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.