ARG: 2026 Guidance Demonstrates Leverage to Copper Price
What you need to know:• ARG reported Q4 and 2025 production results that came in ahead of our expectations, including 2025 production of 62.2Mlbs (vs. our 60.8Mlbs) and Q4 production of 18.9Mlbs (vs. our 17.5Mlbs).
• Cash costs were in line with our estimates, and ARG ended the quarter with an excellent cash position of $40.3M.
• Management is guiding for 63.8Mlbs of production in 2026, its sixth consecutive increase. ARG is assuming $4.80/lb copper, resulting in EBITDA of $74.5M and FCF of $34.8M.
This morning, Amerigo Resources (ARG:TSX, ARREF:OTC) reported its Q4 and 2025 production results, beating our expectations due to strong operational performance. ARG also provided its 2026 guidance, including its sixth consecutive year of production increases and illustrating its leverage to the copper price. We are maintaining our BUY rating and increasing our target price to C$6.50/share (previously C$4.75/share) on ARG.
2025 Production Highlights
• Copper produced for FY25 came in at 62.2Mlbs (-4% YoY) compared to our estimates of 60.8Mlbs and beating its revised guidance. This demonstrated MVC’s resilience and ability to adapt to changes, reaching 98.4% availability without lost-time accidents or environmental incidents.
• 111.3Ktpd of fresh tailings were processed during the year (-10% YoY). Additionally, 48.9Ktpd in historic tailings (+23% YoY) were processed for FY25. The grade from the fresh tails was 0.171%, while the historic tailings grade increased to 0.243%. Copper recoveries were 22.8% for the fresh tailings and 32.2% for the historic tailings.
• Cash costs came in at $1.93/lb for the year, in line with our estimates of $1.94/lb. Normalized cash cost was $1.87/lb after excluding the signing bonus associated with a 3-year collective labour agreement. ARG has record-low treatment and refinery charges in 2025.
• Moly production for the year came in at 1.5Mlbs, beating our estimate of 1.3Mlbs and the annual guidance of 1.3Mlbs.
• ARG spent $10.9M in capex in 2025 compared to its budget of $13.0M, where $2.0M from the 2025 budget will be shifted to 2026 with project completions expected in Q1.
• ARG reported a cash position of $40.3M with no debt, after paying down $11.5M in debt in 2025.
Amerigo Resources is engaged in the production of copper and molybdenum concentrates with operations in Chile. Through its subsidiary, Minera Valle Central S.A., Co. has a contract with Chile's state-owned copper producer National Copper Corporation to process the tailings from El Teniente underground copper mine.
Atrium Research provides institutional quality issuer paid research on North American public equities using deep fundamental analysis. Our research reports are disseminated through Bloomberg, FactSet, Capital IQ, Reuters and many more, as well as through our social media and email distribution lists.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.