6) Hudbay Minerals Inc. (NYSE:HBM)
Average Upside Potential: 34.3%
Hudbay Minerals Inc. (NYSE:HBM) is a diversified mining company, which is focused on the exploration, development, operation, and optimization of properties in North and South America.
Market experts opine that Hudbay Minerals Inc. (NYSE:HBM)’s diverse portfolio of assets, which span Canada and Peru, places the company well to capitalize on the increasing global demand for copper and gold. The company made significant strides in stabilizing and optimizing its operations. These efforts should result in improved throughput and set the stage for higher production. For example, Hudbay Minerals Inc. (NYSE:HBM) has successfully extended the life of its Constancia mine in Peru by 3 years to 2041. This extension reflects its ability to create ongoing value from the existing assets and provides a longer-term production outlook.
The company’s growth strategy revolves around the advancement of the Copper World project in Arizona. The Copper World project demonstrates a potential step-change for Hudbay Minerals Inc. (NYSE:HBM), providing significant copper production growth and value creation opportunities over the medium term. The company remains focused on pursuing a “3-P Plan” for Copper World, emphasizing Permits, a feasibility study Plan, and a Prudent financing strategy.
Hudbay Minerals Inc. (NYSE:HBM) is ramping up engineering studies in a bid to expand plant capacity earlier than previously planned. This hints at a proactive approach to maximizing the project’s potential.
Apart from Copper World, the company has been actively exploring expansion opportunities within its existing portfolio. Hudbay Minerals Inc. (NYSE:HBM) initiated its largest annual regional exploration program at Snow Lake, which highlights the potential for further resource discoveries and reserve growth throughout its asset base.
L1 Capital, an investment management firm, released its second quarter 2024 investor letter. Here is what the fund said:
“Hudbay Minerals Inc. (NYSE:HBM) (Long +31%) shares rallied over the quarter driven by rising copper and gold prices, as well as strong production results. The company’s first quarter results showed higher gold production and robust operating performance at both its major assets, which exceeded consensus expectations. In addition, the company announced a ~US$400m equity raise to support balance sheet de-leveraging and fund its key growth projects. Hudbay is a mid-tier mining company primarily producing copper, alongside gold and zinc, with its key assets located in Canada and Peru. We are attracted to Hudbay due to our positive medium-term outlook for copper and the company’s strong near-term free cash flow generation. This cash generation potential will allow the company to de-lever and recycle capital back into its highly prospective exploration program and major growth projects, most notably its Copper World project in Arizona.”
