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Ero Copper Corp. (TSE:ERO)
:ERO
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Ero Copper (ERO) AI Stock Analysis

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TSE:ERO

Ero Copper

(NYSE:ERO)

Rating:58Neutral
Price Target:
C$21.00
▲(5.90%Upside)
Ero Copper's score is influenced by moderate financial performance and technical challenges, despite positive strategic progress and liquidity highlighted in the earnings call. Valuation concerns also weigh on the score.
Positive Factors
Commercial Production
ERO declared commercial production at Tucuma, which confirms the operation is ramping and will drive a step-change in ERO's copper production and free cash flow generation.
Profitability
Tucuma has high grades and recoveries with a low strip ratio, making it a highly profitable mine at current copper prices.
Valuation
The stock is trading at a P/NAV of 0.76x, below its historical multiple, indicating a potential buying opportunity.
Negative Factors
Guidance Reduction
The company updated its 2025 copper production guidance to 75-85Kt, below the previous 95-105Kt, due to expected ramp-up of Tucumã.
Operational Challenges
2024 production results were below previous guidance, primarily due to Tucumã's ramp-up challenges, including power disruptions and tailings filtration circuit issues.
Production Miss
Q2 production missed expectations as ERO produced 6.4kt copper, below the consensus of 9.2kt, due to repairs and modifications to the process plant.

Ero Copper (ERO) vs. iShares MSCI Canada ETF (EWC)

Ero Copper Business Overview & Revenue Model

Company DescriptionEro Copper Corp., a base metals mining company, engages in the exploration, development, and production of mining projects in Brazil. It engages in the production and sale of copper concentrate from the MCSA Mining Complex located within the Curaçá Valley, northeastern Bahia state, as well as gold and silver byproducts. The company also holds a 100% interest in the Boa Esperança property, a copper development project located within southeastern Pará state; and NX Gold property located in Mato Grosso state. Ero Copper Corp. was incorporated in 2016 and is headquartered in Vancouver, Canada.
How the Company Makes MoneyEro Copper generates revenue primarily through the extraction, production, and sale of copper concentrate. The company extracts copper ore from its mines and processes it into concentrate, which is then sold to various customers, including smelters and commodity traders. Ero Copper's earnings are significantly influenced by the global price of copper, which can fluctuate based on market demand, geopolitical factors, and economic conditions. Additionally, the company engages in exploration activities to discover new mineral deposits, which can potentially enhance its resource base and future revenue streams. Strategic partnerships with local and international entities may also play a role in the company's operational and financial outcomes, although specific partnerships were not detailed in the available data.

Ero Copper Earnings Call Summary

Earnings Call Date:May 05, 2025
(Q1-2025)
|
% Change Since: 13.12%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong financial performance and progress toward achieving commercial production at Tucuma, alongside robust liquidity. However, challenges in copper production at Caraiba and a decrease in gold production at Xavantina were notable lowlights.
Q1-2025 Updates
Positive Updates
Tucuma Operational Progress
Tucuma's commercial production is on track to be achieved soon, with March accounting for more than half of the total plant throughput and copper production during the first quarter. Throughput volumes are expected to increase steadily.
Liquidity Position
Ero Copper ended the quarter with a solid liquidity position of $116 million, supported by several actions to strengthen the balance sheet and support long-term growth.
Strong Financial Performance
The quarter saw an adjusted EBITDA of $65.4 million and adjusted net income attributable to owners of the company of $35.8 million or $0.35 per share.
Exploration and Growth Initiatives
Aggressive advancement of long-term growth initiatives, particularly at the Furnas site with eight drill rigs operating and a Phase 1 drill program expected to be completed in the third quarter.
Negative Updates
Copper Production Challenges at Caraiba
Lower planned mined and processed copper grades resulted in a quarter-on-quarter decline in copper production and elevated unit cost during the first quarter.
Gold Production Decrease at Xavantina
Total mine and process volumes increased, but lower grades mined and processed resulted in a decrease in total gold production. Additional ground support at access points of several newly developed higher-grade areas delayed contributions.
Tucuma Ramp-Up Delays
The repair of the third tailings filter was completed at the end of April, slightly behind the original schedule. Throughput volumes were somewhat muted due to this delay.
Company Guidance
During the first quarter of 2025, Ero Copper focused on achieving its near-term strategic objectives, including commercial production at Tucuma, deleveraging the balance sheet, advancing long-term growth initiatives, and initiating shareholder returns. The company experienced significant progress at Tucuma, with March accounting for over half of the quarter's plant throughput and copper production. Adjusted EBITDA for the quarter was $65.4 million, with adjusted net income attributable to owners of $35.8 million or $0.35 per share, supported by stronger metal prices and the growing contribution from Tucuma. The company ended the quarter with $116 million in liquidity, having increased its credit facility to $200 million and drawn $25 million from its copper prepayment facility. Ero Copper also executed a $50 million extension of its stream agreement with Royal Gold to support capital investments, and it entered into zero-cost copper collars to hedge 3,000 tons per month at a floor of $4 per pound.

Ero Copper Financial Statement Overview

Summary
Ero Copper faces challenges with low net profit margins and negative free cash flow despite moderate operational efficiency. The stable balance sheet suggests potential if profitability and cash flow improve.
Income Statement
65
Positive
Ero Copper shows a mixed performance in profitability and growth. The TTM gross profit margin is healthy at 41.85%, and EBIT margin is robust at 31.20%. However, the net profit margin is relatively low at 3.86%, indicating challenges in achieving profitability despite strong operational efficiency. Revenue growth from the previous year is 4.10%, reflecting moderate growth in a competitive market.
Balance Sheet
60
Neutral
The balance sheet reveals a moderate financial position. The debt-to-equity ratio is 0.93, indicating a balanced use of debt, but the equity ratio of 42.36% suggests a stable reliance on equity financing. Return on equity is low at 2.65%, pointing to inefficient use of equity to generate profits.
Cash Flow
55
Neutral
Cash flow analysis shows challenges in liquidity management. The operating cash flow to net income ratio is strong at 10.25, indicating good cash generative capability relative to profits. However, free cash flow is negative, which could constrain future investments and growth opportunities.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue470.26M427.48M426.39M489.92M324.08M
Gross Profit180.55M156.84M187.18M318.86M188.14M
EBITDA13.78M208.15M206.48M289.80M110.92M
Net Income-68.47M92.80M101.83M201.05M51.62M
Balance Sheet
Total Assets1.46B1.51B1.19B689.76M497.10M
Cash, Cash Equivalents and Short-Term Investments50.40M111.74M317.40M130.13M62.51M
Total Debt620.07M445.84M429.02M66.36M169.85M
Total Liabilities866.95M702.36M645.91M294.27M283.02M
Stockholders Equity587.13M804.25M538.59M393.06M212.70M
Cash Flow
Free Cash Flow-192.17M-297.55M-152.43M182.76M45.03M
Operating Cash Flow145.42M163.10M143.39M364.59M162.84M
Investing Cash Flow-335.38M-308.17M-425.81M-179.53M-116.56M
Financing Cash Flow131.16M77.75M327.30M-115.43M288.00K

Ero Copper Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price19.83
Price Trends
50DMA
20.68
Negative
100DMA
18.97
Positive
200DMA
20.34
Negative
Market Momentum
MACD
-0.34
Positive
RSI
46.58
Neutral
STOCH
42.76
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ERO, the sentiment is Neutral. The current price of 19.83 is below the 20-day moving average (MA) of 21.17, below the 50-day MA of 20.68, and below the 200-day MA of 20.34, indicating a bearish trend. The MACD of -0.34 indicates Positive momentum. The RSI at 46.58 is Neutral, neither overbought nor oversold. The STOCH value of 42.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:ERO.

Ero Copper Peers Comparison

Overall Rating
UnderperformOutperform
Sector (44)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
58
Neutral
C$2.05B69.932.54%16.82%-67.73%
44
Neutral
AU$1.51B-6.04-41.37%3.88%-3.45%-43.04%
$4.08B26.516.50%0.14%
$1.09B10.75-12.40%
$8.95B24.682.66%2.04%
$4.57B55.992.71%
$14.93B108.331.22%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:ERO
Ero Copper
19.83
-6.95
-25.95%
HBM
Hudbay Minerals
10.12
2.14
26.82%
TGB
Taseko Mines
3.44
1.29
60.00%
LUNMF
Lundin Mining
10.26
0.30
3.01%
CSCCF
Capstone Copper
5.99
-0.49
-7.56%
FQVLF
First Quantum Minerals
17.53
5.45
45.12%

Ero Copper Corporate Events

Business Operations and Strategy
Ero Copper Completes Phase 1 Drilling at Furnas Project, Extends Mineralization
Positive
Jul 10, 2025

Ero Copper has successfully completed its Phase 1 drill program at the Furnas Copper-Gold Project in Brazil, revealing significant down-dip intercepts that extend the known limits of mineralization. The results demonstrate strong continuity of high-grade mineralization, with potential implications for large-scale underground mining operations. The ongoing Phase 2 drill program aims to further extend mineralization, with the complete results from Phase 1 serving as a foundation for an updated mineral resource estimate and a preliminary economic assessment, expected in the first half of 2026.

The most recent analyst rating on (TSE:ERO) stock is a Buy with a C$25.00 price target. To see the full list of analyst forecasts on Ero Copper stock, see the TSE:ERO Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
Ero Copper to Announce Q2 2025 Results, Hosts Conference Call
Neutral
Jun 24, 2025

Ero Copper Corp announced it will release its second quarter 2025 operating and financial results on July 31, 2025, after market close. The company will host a conference call the following day to discuss the results, providing stakeholders with insights into its operational and financial performance. This announcement is significant as it will offer updates on Ero Copper’s growth trajectory and market positioning, potentially impacting investor perceptions and market dynamics.

The most recent analyst rating on (TSE:ERO) stock is a Buy with a C$39.00 price target. To see the full list of analyst forecasts on Ero Copper stock, see the TSE:ERO Stock Forecast page.

Executive/Board ChangesShareholder Meetings
Ero Copper Corp Announces AGM Voting Results, Reaffirms Governance
Positive
Apr 25, 2025

Ero Copper Corp announced the results of its Annual General Meeting of Shareholders, where 85.44% of its common shares were represented. Shareholders approved all items, including the re-election of ten directors, the appointment of KPMG LLP as auditors, and an advisory vote on executive compensation. These approvals reflect strong shareholder support and are likely to positively impact the company’s governance and strategic direction.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Jul 11, 2025