Lundin Mining (TSX:LUN) has had a stellar run over the past year, with its share price up more than 25% from its 52-week low. Copper prices have been strong, gold prices even stronger, and the company’s latest results show a business firing on multiple fronts. But for investors who bought in before this rally, the question now is whether it’s time to take some profits or keep riding the wave.
What happened?
The second quarter (Q2) of 2025 gave shareholders plenty to cheer about. Revenue from continuing operations came in at US$937.2 million, up 6.7% from the same quarter last year. Net earnings from continuing operations hit US$126.1 million, or US$0.15 per share, a healthy improvement from US$84.3 million a year ago. Cash flow from operations reached US$314.6 million, even after paying US$168 million in income taxes at Candelaria. And perhaps most importantly for long-term health, consolidated copper cash costs fell to US$1.92 per pound, down 7% from the prior quarter.
Operationally, the company delivered 80,073 tonnes of copper, 38,118 ounces of gold, and 2,713 tonnes of nickel in Q2. Chapada was a standout with its lowest copper cash costs since 2021, helped by higher gold by-product credits. Candelaria saw solid throughput from Phase 11 and 12 mining areas, while Caserones navigated lower grades with solid leach pad performance. Eagle had some short-term operational hiccups, but is set to normalize production in the back half of the year.
A major strategic shift this year was the US$1.4 billion sale of Lundin’s European assets, which allowed the company to pay down its term loan entirely and trim net debt to just US$135 million. This cleaner balance sheet gives Lundin stock more flexibility to pursue growth while still returning capital to shareholders through buybacks and dividends. In Q2 alone, the company repurchased 4.6 million shares for $36.2 million and declared a quarterly dividend of $0.0275 per share.
More to come
Looking ahead, the growth story is ambitious. Lundin reaffirmed 2025 guidance for copper production of 303,000 to 330,000 tonnes and continues to advance its Vicuña Project in Argentina and Chile. The recently announced mineral resource for Vicuña ranks among the largest copper, gold, and silver resources globally, setting the stage for a potential multi-phase development that could transform Lundin into a top-ten copper producer. Brownfield expansion opportunities at existing mines add another layer of potential upside.
So, why would anyone sell here? The main reason would be valuation and cyclicality. At a forward price-to-earnings (P/E) of around 22, the stock isn’t exactly cheap for a mining company in a sector where earnings can swing hard with commodity prices. Copper and gold have both enjoyed supportive pricing environments lately. Yet those can turn quickly if global growth slows or China’s demand continues to wobble. Investors sitting on large gains might feel more comfortable locking in profits rather than risking a sharp pullback if markets turn.
Considerations
Another consideration is execution risk. While Vicuña and other projects are exciting, large-scale developments in mining are rarely straightforward. Costs can escalate, timelines can stretch, and commodity cycles can shift during the build-out period. Holding through that uncertainty makes sense for long-term growth-oriented investors, but those with a shorter time horizon might prefer to wait on the sidelines for a better re-entry point.
On the flip side, there are strong reasons to hold. Lundin stock’s operational performance is improving, costs are trending down, and the balance sheet is in better shape than it has been in years. The company has a clear plan for growth, a history of shareholder returns, and a diversified production base that includes copper, gold, nickel, and even molybdenum. If you believe copper’s structural demand drivers will keep prices elevated, Lundin stock is well-positioned to benefit.
Bottom line
For many, the best move may be a middle ground. Take some profits to protect against volatility, but keep enough skin in the game to benefit if the company’s ambitious growth plans pay off. That way, you capture today’s success without closing the door on tomorrow’s opportunity.
