Is Fortuna Mining Still Attractive After a 113% Run Amid Growing Gold and Silver Focus?

• If you are wondering whether Fortuna Mining is still a smart buy after its big run or if you are turning up late to the party, this breakdown is designed to help you figure out what the stock is really worth.
• The share price has climbed an impressive 113.4% over the last year and is up 100.8% year to date, even after a recent 1.6% dip over the past week and a solid 10.5% gain over the last month.
• These moves have come as investors refocus on gold and silver producers amid shifting rate expectations and renewed interest in precious metals as a hedge. At the same time, Fortuna has been in the headlines for expanding its production footprint and progressing key assets, which has helped reset market expectations around its growth profile and risk.
• Despite that rally, Fortuna scores a 5/6 valuation check rating, suggesting the market may not be fully pricing in its fundamentals. Next, we will walk through how different valuation methods stack up, before finishing with a more holistic way to judge what the stock could really be worth.

Find out why Fortuna Mining's 113.4% return over the last year is lagging behind its peers.

Approach 1: Fortuna Mining Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow model estimates what a company is worth by projecting the cash it can generate in the future and then discounting those cash flows back to today, to reflect risk and the time value of money.

For Fortuna Mining, the latest twelve month Free Cash Flow (FCF) stands at about $168.4 Million. Analysts and model assumptions expect this to grow rapidly, with FCF projected to reach roughly $2.05 Billion by 2035, based on a 2 Stage Free Cash Flow to Equity model that blends analyst estimates in the early years with extrapolated growth beyond the explicit forecast period.

Using these projections, the DCF model arrives at an estimated fair value of about $143.51 per share. Compared with the current market price, this implies the stock is trading at a 90.8% discount to its intrinsic value. This suggests investors may still be underestimating Fortuna’s long term cash generation potential.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Fortuna Mining is undervalued by 90.8%. Track this in your watchlist or portfolio, or discover 916 more undervalued stocks based on cash flows.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Fortuna Mining.

Approach 2: Fortuna Mining Price vs Earnings

For profitable companies like Fortuna Mining, the Price to Earnings, or PE, ratio is a useful way to gauge value because it links what investors pay today to the earnings the business is generating right now. In general, stronger and more reliable earnings growth, combined with lower perceived risk, justifies a higher PE ratio, while slower growth or higher risk usually leads to a lower, more conservative multiple.

Fortuna currently trades on a PE of 11.3x, which looks modest against both the Metals and Mining industry average of about 20.9x and the broader peer group average of 25.2x. Simply Wall St also calculates a proprietary Fair Ratio of 17.8x for Fortuna, which reflects what a reasonable PE might be once you factor in its earnings growth outlook, profitability, size and risk profile, rather than just comparing it with a rough industry or peer average.

This Fair Ratio framework is more tailored, as it adjusts for the specific mix of growth, margins, industry dynamics and market cap that drive what investors typically pay for a stock like Fortuna. Comparing Fortuna’s actual PE of 11.3x with the Fair Ratio of 17.8x suggests the shares still trade at a meaningful discount on an earnings basis.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1458 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Fortuna Mining Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives, a simple way to attach your story about Fortuna Mining to the numbers you believe in, by linking your assumptions for future revenue, earnings and margins to a financial forecast, a fair value and ultimately a clear buy or sell decision.

On Simply Wall St’s Community page, used by millions of investors, you can choose or create a Narrative that reflects your view. You can then compare its Fair Value to the current share price to decide whether Fortuna looks attractive, expensive or fairly priced, and watch that view update automatically as new news, earnings or guidance change the underlying data.

For example, around Fortuna, some investors are building bullish Narratives with fair values closer to about CA$13.30 based on strong West African growth and improving margins. More cautious investors anchor their Narratives nearer to roughly CA$8.01, reflecting concerns about project execution, costs and geopolitical risk. This spread in fair values neatly illustrates how the same company can look like a buy, hold or sell, depending on the story and assumptions you think are most probable.

Do you think there's more to the story for Fortuna Mining? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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