Analysts at Berenberg upgraded copper miner Atalaya Mining Plc from 'hold' to 'buy' on Thursday, admitting that they were "late to the party".
Berenberg said Atalaya's shares had enjoyed "a strong run" year-to-date, with copper prices up over 20% on tight markets and the firm itself delivering "a solid operational year", with good cash-flow generation, while also benefiting from index buying following a corporate redomicile that saw the shares enter the FTSE 250.
The German bank, which raised its target price on the stock from 630p to 760p, thinks that the Atalaya can benefit from a number of catalysts that it believes will drive the shares higher.
"We adjust our model for the recent Q3 results (while also making small model tweaks) and lift our EV/EBITDA multiple to 8x (from 6x), reflecting the current market premium for copper equities," said the analysts.
Berenberg added that Atalaya's shares were currently trading on 1.19x net asset value and 4.5x 2026E underlying earnings.
Reporting by Iain Gilbert at Sharecast.com