With copper prices surging to 10-year highs, here are the ASX mining shares with a focus on copper production and exploration.
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Copper prices have surged to US$4.44/lb, the highest since 2011.
Oz Minerals Limited (ASX: OZL)
Oz Minerals is the largest copper-focused ASX share with a market capitalisation of approximately $8 billion. Its shares have soared alongside copper prices, up 26% year-to-date and more than 150% in the past 12-months to record territory.
The company delivered a mixed first-quarter update with the softer copper product due to its Carrapatenna mine switching contractors, which lowered fleet availability and grades. Despite quarterly production potentially missing expectations, the company believes it is on track to meet its FY21 production guidance.
Oz Minerals continues to eye several growth pipeline projects with a number of drilling programs underway.
Brokers are relatively mixed on Oz Mineral shares with an average price target of $23.16 across Morgans, Macquarie, Credit Suisse and Morgan Stanley. Commentary has highlighted a stronger performance out of Carrapateena in the June quarter and the solid copper price to continue to drive earnings upside momentum.
Sandfire Resources Ltd (ASX: SFR)
Sandfire is another mid-tier copper producer with a market cap of approximately $1.1 billion. The company has leveraged the recent surge in copper prices, with its interim net profits surging from $34.2 million in 1H20 to $60.8 million in 1H21.
Sandfire has started developing its significant copper-silver production hub in Botswana, receiving board approval for the initial 3.2Mtpa operation.
The most recent broker update from Macquarie on 9 March believes higher copper prices will significantly impact Sandfire Resources.
The broker estimates the earnings forecast could rise by an average of 90% over the next five years. Macquarie rates its shares as outperform with an $8.8 target price. Sandfire shares are currently fetching $6.35.
Copper Mountain Mining Corp (ASX: C6C)
Copper Mountain shares have more than doubled this year and are up an eye-watering 800% in the past 12 months. The company has made an outstanding transition from explorer to producer, with record production and revenues flowing through.
Copper Mountain released a quarterly activities report on Tuesday, highlighting quarterly revenue of $162.2 million and gross profit of $96.3 million from the sale of 27.5 million pounds of copper, 8,553 ounces of gold and 161,657 ounces of silver.
While the company may sound like a mid-tier producer, it boasts a market capitalisation of just ~$67 million.
Cyprium Metals Ltd (ASX: CYM)
Cyprium focuses on mid to late-stage local copper projects that could be fast-tracked into the production of copper metal.
The company recently acquired a portfolio of copper projects from Metals X Limited (ASX: MLX). Cyprium executive director Barry Cahill commented on the acquisition, saying:
We look forward to leveraging our many years of combined team experience, to position Cyprium to establish itself as a significant Australian mid-tier copper producer.
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Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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