-- Stifel Canada on Thursday maintained its buy rating on the shares of Capstone Copper (CS.TO) and its C$20.00 price target following first-quarter results from the Brazilian miner.
"Capstone reported Q1/26 adjusted EPS of $0.12 vs. our $0.10 (consensus: $0.11) and adjusted EBITDA of $329Mln vs. our $263Mln (consensus: $291Mln) on copper production of 48.0Kt vs. our 39.3Kt at C1 cash cost of $2.66/lb vs. our $2.81/lb. The stronger Q1/26 was driven by post-strike Mantoverde operating above design throughput and stronger by-product credits, offsetting higher tax expense. FY26 guidance was reiterated including consolidated copper production of 200-230Kt at $2.45-2.75/lb C1 cash cost, with management flagging higher diesel and sulphuric acid prices as Middle East-driven cost headwinds put upward cost pressure on sulphide and acid-consuming oxide production. We estimate $64Mln or 5.9% EBITDA downside on uncontracted acid exposure at spot acid prices ($425+/t) excluding offsetting tailwinds of stronger copper and by-product prices (silver, gold, molybdenum). MVO remains on-plan with $176Mln capex unchanged and 45Ktpd throughput targeted by early-2027; Santo Domingo FID timing was tightened to Q4/26 (from H2/26)," analyst Ralph Profiti wrote.
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