Boliden (Buy, TP: SEK470.00) - The (long-term) trend is your friend

We have increased our 2024–2025e EBITDA by c2–7% on higher metal price assumptions, and despite the recent strong share-price performance, find the low valuation multiples highly appealing. We expect a material rise in Q3 earnings due to more favourable metal prices and better mining operations than in preceding quarters. In addition to the favourable position in copper and gold mining, we remain intrigued by company-specific earnings drivers for 2024–2027. We reiterate our BUY and have raised o...

Boliden (Buy, TP: SEK450.00) - Q2 should not be extrapolated

Although the smelting business reported Q2 earnings above our expectations, this was more than offset by weak operations for the mining division, implying temporarily high opex and low volumes. Reflecting the severe Q2 earnings miss and much higher mining opex for H2e, we have lowered our 2024e EBITDA by 18% while reducing our 2025–2026e EBITDA by 6–7%. While acknowledging the weak near-term momentum, we continue to see attractive and growing profits from 2025e translating into very appealing mu...

Boliden (Buy, TP: SEK480.00) - Mining division boosting the group

Due to lower metal price assumptions and a more cautious price view for the smelting business, we have lowered our 2024–2025e EBITDA by c6–9%. Still, our forecasts translate into highly appealing valuation multiples, and we expect underlying Q2 earnings to show a distinct increase due to more favourable metal prices and better mining operations than in preceding quarters. In addition to the favourable position in copper and gold mining, we also remain intrigued by company-specific earnings drive...

Boliden (Buy, TP: SEK500.00) -

Battered for a number of quarters by operating issues, lower metal grades at key mines and falling metal prices, we believe Boliden’s earnings headwind is now a tailwind. Moreover, on top of support from higher metal prices, we see distinct company-specific earnings drivers for 2024–2027e: 1) Odda completion; 2) Tara restart; 3) restored Rönnskär operations; and 4) normalised copper grades at Aitik. Our 2027e record earnings translate into a low P/E of c7x, and we see ample room for cash distrib...

Boliden (Buy, TP: SEK420.00) - In a sweet spot

Despite low mining volumes, the Q1 results were close to our expectations, thanks to good cost control. We have made significant estimate increases on better metal price and FX assumptions, and beyond 2024 we continue to see additional earnings support from: 1) higher mining volumes due to richer metal grades; 2) normal operations at Rönnskär; and 3) growing profits from the Odda smelter. Our spot-based estimates for 2027 translate to an EV/EBIT of 5.2x, but we see significant upside potential t...

Boliden (Buy, TP: SEK380.00) - Rosy outlook for copper and gold

Having significantly increased our earnings forecasts, we have raised our target price to SEK380 (320) on higher metal price assumptions, and reiterate our BUY. Acknowledging the operational issues, we still expect a sharp increase in earnings from 2025, due to: 1) higher metal prices; 2) higher volumes due to richer metal grades; 3) normal operations at Rönnskär; and 4) growing profits from the Odda smelter. Our spot-based forecasts for 2027 translate into an EV/EBIT of 6x, but we see significa...

Boliden (Buy, TP: SEK320.00) - Look beyond the current weakness

Our view on the investment case remains essentially unchanged after a Q4 report that was stronger than our cautious expectations. Near-term, low metal grades from key mines and modified operations at the Rönnskär smelter will continue to weigh on earnings; however, we see a sharp increase in earnings from 2025e as a result of: 1) higher volumes due to richer metal grades; 2) normal operations at Rönnskär; and 3) growing profits from the Odda expansion. We reiterate our BUY and our SEK320 target ...

Boliden (Buy, TP: SEK320.00) - Better times ahead

We have made hefty estimate cuts and lowered our target price to SEK320 (380) on reduced FX and metal price assumptions. Near-term, low metal grades from key mines and modified operations at the Rönnskär smelter are set to weigh on earnings. However, we continue to expect a sharp increase in earnings from 2025 on: 1) higher volumes due to richer metal grades; 2) normal operations at Rönnskär; and 3) growing profits from the Odda smelter. Our spot-based forecasts for 2027 translate to an EV/EBIT ...

Boliden (Buy, TP: SEK380.00) - Mind the gap

Despite lower metal grades from key mines and modified Rönnskär smelter operations, which are set to weigh on 2024–2025e, earnings should remain healthy. For 2026–2027e, earnings should rise significantly on: 1) normalised metal grades from key mines; 2) Rönnskär being back on track; and 3) incremental profits from the Odda expansion, leading to a low P/E of c8x. Boliden’s exposure to metals offers favourable long-term price trends, and with support from our conservative SOTP valuation indicatin...

Boliden (Buy, TP: SEK330.00) - Liking the exposure and values

Liking the exposure and values In our view, the mixed Q3 report included more positives than negatives. As we believe much of the risk of cuts to consensus has been eliminated, we have raised our target price to SEK330 (315) and upgraded to BUY (HOLD). Near-term, low metal grades from key mines and modified operations at the Rönnskär smelter are set to weigh on earnings; however, we see a sharp increase in earnings from 2025 as a result of: 1) higher volumes due to richer metal grades; 2) norma...

Boliden (Hold, TP: SEK315.00) - Appreciation yet to come

While we remain concerned about near-term earnings risk, we believe the elevated company-specific risks are largely priced in. That said, we do not expect the stock to outperform until clarity is provided on the three company-specific issues: 1) risks related to grades at Boliden’s key mines for 2024–2025e; 2) the full impact of the recent fire at the Rönnskär smelter; and 3) the status of the Tara zinc mine. We reiterate our HOLD but have increased our target price to SEK315 (300) on higher est...

Boliden (Hold, TP: SEK300.00) - Blow to the investment case

We are puzzled by Boliden’s poor Q2 earnings, where the weak spot was the mining division, which reported historically poor quarterly EBIT of below SEK200m due to a combination of weaker prices, low volumes and high opex. Primarily reflecting higher costs for the mines, we have lowered our 2023–2024e EBITDA by 16–15%. Based on our estimate cuts and the higher risk to the outlook, we have reduced our target price to SEK300 (340). We reiterate our HOLD.

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Boliden (Hold, TP: SEK340.00) - Elevated risks ahead of Q2

On new FX assumptions and an even more cautious view on the full impact of the fire damage at Rönnskär that will hit 2024e too, we have cut our 2023–2024e EBIT by 20–13%. While we still see an attractive long-term investment case underpinned by convincing mega-trends (green battery metals), we are increasingly concerned about the near-term risks. The full negative impact of restoring the Rönnskär smelter remains unclear and could continue to weigh on the stock, which is down only 6% since before...

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Boliden (Hold, TP: SEK376.00) - Higher risk and broken confidence

Although the financial impact from the fire at Rönnskär is impossible to quantify, the damage should be substantial for the coming quarters, as the critical cell house has burned down and will need to be rebuilt. In addition, Boliden has guided for lower grades for its Kevista and Tara mines in Q2, and due to a worsened outlook for the Tara mine, it has decided to temporarily idle the mine’s operations. Reflecting our estimate cuts and the risker outlook, we have downgraded to HOLD (BUY) and cut...

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Boliden (Buy, TP: SEK460.00) - ‘Self-help’ and diversification

Due to our lower price assumptions, we have cut our 2023–2024e EBITDA by 5–7%. Still, we continue to see healthy 2023–2024e earnings, with relatively low downside risk thanks to Boliden’s unique diversification across base and precious metals. Furthermore, we expect sustained earnings improvement from 2025e owing to better metal grades at the Aitik mine and new profits from the Odda investment. We reiterate our BUY but have cut our target price to SEK460 (504).

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