JP Morgan reiterated its 'overweight' recommendation on Antofagasta PLC (LSE:ANTO) and retained the shares on its Europe, Middle East and Africa Analyst Focus List, with an unchanged December 2027 price target of £44.00 per share.
The bank argued that Antofagasta offered around 30% copper volume growth by 2028 to 2029 compared with 2024 levels, positioning it as one of the fastest-growing names among its global copper peers.
JPM double upgraded Antofagasta to Overweight in February 2025. Since then, the outlook for both Antofagasta and the wider copper sector has improved as the copper market tightened.
However, the focus of investor discussions had shifted towards the rising capital intensity of new organic growth projects across the industry.
Earlier this week, Lundin Mining, rated 'neutral' by JPM, announced that its Vicuña greenfield project, a 50:50 joint venture with BHP, would require significantly higher capital expenditure than previously expected.
BHP separately outlined plans for more than 40% copper volume growth by the 2035 financial year, which the US investment bank said would also entail substantial capital investment.
In contrast, Antofagasta’s growth profile relied more heavily on lower capital intensity brownfield expansions, meaning expansions at existing operations rather than entirely new mines.
Management was advancing a series of such projects to replenish the development pipeline beyond 2029.
JPM forecast that this near-term production growth would drive a de-rating of the enterprise value-to-earnings before interest, tax, depreciation and amortisation multiple, which compares a company’s total valuation with its operating profit.
The bank expected the multiple to fall from around 11 times in 2026 to about seven times in 2028 as earnings expanded.
It also forecast a free cash flow yield inflexion, with free cash flow moving from negative in 2025 to a positive 7% by 2028, compared with peers on roughly 6%.
Following the 2025 full year results, JP Morgan increased its 2026 and 2027 group earnings before interest, tax, depreciation and amortisation forecasts by 2% and 1% respectively.
The bank’s forecasts stood 4% and 17% above Bloomberg consensus for 2026 and 2027 earnings before interest, tax, depreciation and amortisation.
On spot commodity prices, its estimates were 15% and 31% ahead of consensus for those years.
The shares, down after results on Tuesday, exacerbated by a sector-wide sell-off, bounced back 4% on Wednesday to trade at 3,760p.