Shares in the Chilean copper miner Antofagasta PLC (LON:ANTO) were higher in morning trade after Investec raised its recommendation on stock in the company.
The investment bank moved to ‘buy’ from ‘hold’ to better reflect its ‘leverage’ to the fortunes of the red metal.
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Copper prices are now back to highs last seen in 2014 and the long-term outlook is positive, Investec said.
Well placed to benefit
“All of the major diversified miners have identified copper as a vital commodity within their portfolios, with BHP Billiton recently stating that 2017 will be the year of the electric vehicle revolution, with copper the metal of the future,” the bank said in a note to clients.
“Antofagasta’s scale and growth potential leaves it well placed to benefit.”
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At 10.10am, the shares were up 14 pence at 942.5p. Investec reckons the stock is worth 1,046p based on a net present value calculation (up from 957p previously).
Four Chilean operations
The company operates four mines in Chile – its flagship Los Pelambres operation, Centinela, Antucoya and Zaldívar – as well as operations around the world.
Last year it mined 709,000 tonnes of copper at a cash cost of US$1.20 a pound; its minerals resource stands at a whopping 18.7bn tonnes of ore.
It also produces gold (around 271,000 ounces last year) and a metal called molybdenum.