Copper may have stumbled recently, however a constrained supply side paints a very bullish picture over the long-term. Resources expert Stephane Andre, from Alphinity Investment Management, outlines the dynamics of the metal’s price in this short video, with a copper stock that he says is ‘strongly undervalued’.
- Copper is used worldwide across transport, electricity, and appliances, and is a very good indicator of global activity.
- The copper price has been declining recently, principally due to the trade war and sentiment, but also because of a rising US dollar. Longer term, the supply-demand balance is a positive driver for copper as supply is very tight.
- The copper demand picture is a tailwind for OZ Minerals ($3 billion market cap, OZL), but the company has a suite of assets with their own positive fundamentals. The mine-lives of key assets: Carapateena and Prominent Hill, should both increase. The market ascribes little to West Musgrave and Avanco though both have significant potential.
- OZ Minerals stock is ‘strongly undervalued’.
Alphinity’s aim is to deliver consistent outperformance for investors by investing in quality, undervalued companies, with underestimated forward earnings expectations. Find out more
Thank you for these insights as it confirms my thoughts, probably one of the most underestimated management teams in mining.