Capstone Copper shares slide after Macquarie analysts cut target price
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The news: Capstone Copper shares fell in morning trade after Macquarie analysts cut their target price on the miner's stock due to higher than expected capital costs for its Mantoverde Optimized project in Chile.
The numbers: At 10:22am AEST, Capstone Copper shares had fallen 3.8% to $9.78 despite closing 5.3% higher in the previous session.
Macquarie analysts cut their target price on the stock from $13.30 to $12.50 but retained an ‘outperform’ rating.
The context: On Monday, Capstone announced to the ASX that its Mantoverde Optimized project had been sanctioned for construction after receiving all required board approvals. This will extend the life of the copper and gold mine from 19 years to 25 years.
Construction is expected to take about one year, with a ramp-up period to commence in Q4 2026. The total expansionary capital cost is expected to be USD176 million ($270 million).
Macquarie analysts flagged that the expansionary capital expectations is USD30 million higher than previously indicated, with most of the increase stemming from “learnings from the Mantoverde sulphide concentrator ramp-up” as well as inflationary impacts.
The updated investment profile means the Macquarie analysts have lowered their forecasts for earnings per share in calendar year 2026 by 8% and adapted a slightly slower than previously forecast ramp up of Mantoverde to full capacity in 1Q of 2027.
The sources: Macquarie research, ASX
