Mining stocks are having an incredible year, fueled by strong growth in precious metals. Among the top performers is Lundin Mining Corporation (TSX:LUN). Lundin Mining stock is up by staggering numbers – and investors are taking notice.
As of the time of writing, Lundin Mining stock has increased by 30% over the past month and by an eye-popping 77% over the trailing six months.
Here’s why it’s soaring.
Lundin Mining Stock: Why is it soaring?
Beyond the metals rally, Lundin Mining stock is benefiting from stellar strategic execution. This can be traced back to a few key moves.
First, capital discipline. Back in April, Lundin divested its European assets Neves-Corvo and Zinkgruvan for US$1.4 billion. Most of the proceeds were allocated to debt reduction, reducing the amount to US$135 million. The company also earmarked some of those funds to drive growth.
Second, operational focus. Lundin’s streamlined portfolio now has a focus on its higher-margin assets to drive growth. At the Chapada mine in Brazil, efficiency gains and rising precious metals have pushed copper mining cash costs down and margins up.
Finally, improved results. In the most recent quarter, Ludin posted US$930 million in revenue and an impressive US$211 million in free cash flow from operations.
Lundin Mining stock: Your take?
Lundin is leaner, more profitable and more focused now than it was last year. The company also offers investors a dividend, strong growth appeal, and active buybacks.
In my opinion, the whopping 77% gain over the prior 6 months is icing on the cake.
