TSX:LUN

Stock Analysis Report

Executive Summary

Lundin Mining Corporation, a diversified base metals mining company, engages in the exploration, development, and mining of mineral properties in Chile, the United States, Portugal, and Sweden.


Snowflake Analysis

Excellent balance sheet with reasonable growth potential.


Similar Companies

Share Price & News

How has Lundin Mining's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: LUN has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0%

LUN

0.3%

CA Metals and Mining

1.2%

CA Market


1 Year Return

29.2%

LUN

28.3%

CA Metals and Mining

9.6%

CA Market

Return vs Industry: LUN exceeded the Canadian Metals and Mining industry which returned 26.9% over the past year.

Return vs Market: LUN exceeded the Canadian Market which returned 10.4% over the past year.


Shareholder returns

LUNIndustryMarket
7 Day0%0.3%1.2%
30 Day1.2%3.2%2.6%
90 Day12.9%7.8%6.0%
1 Year31.6%29.2%29.2%28.3%13.1%9.6%
3 Year6.8%1.6%-0.4%-2.2%17.1%6.4%
5 Year74.9%66.3%28.4%24.2%36.1%16.0%

Price Volatility Vs. Market

How volatile is Lundin Mining's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Lundin Mining undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: LUN (CA$7.92) is trading below our estimate of fair value (CA$23.95)

Significantly Below Fair Value: LUN is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: LUN is poor value based on its PE Ratio (45x) compared to the Metals and Mining industry average (17.3x).

PE vs Market: LUN is poor value based on its PE Ratio (45x) compared to the Canadian market (15.8x).


Price to Earnings Growth Ratio

PEG Ratio: LUN is poor value based on its PEG Ratio (1.5x)


Price to Book Ratio

PB vs Industry: LUN is good value based on its PB Ratio (1.2x) compared to the CA Metals and Mining industry average (1.5x).


Next Steps

Future Growth

How is Lundin Mining forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

30.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LUN's forecast earnings growth (30.1% per year) is above the savings rate (1.4%).

Earnings vs Market: LUN's earnings (30.1% per year) are forecast to grow faster than the Canadian market (10.3% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: LUN's revenue (10.2% per year) is forecast to grow faster than the Canadian market (5% per year).

High Growth Revenue: LUN's revenue (10.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LUN's Return on Equity is forecast to be low in 3 years time (10.4%).


Next Steps

Past Performance

How has Lundin Mining performed over the past 5 years?

24.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LUN has high quality earnings.

Growing Profit Margin: LUN's current net profit margins (5.7%) are lower than last year (16.2%).


Past Earnings Growth Analysis

Earnings Trend: LUN's earnings have grown significantly by 24.7% per year over the past 5 years.

Accelerating Growth: LUN's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: LUN had negative earnings growth (-67%) over the past year, making it difficult to compare to the Metals and Mining industry average (-1.4%).


Return on Equity

High ROE: LUN's Return on Equity (2.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Lundin Mining's financial position?


Financial Position Analysis

Short Term Liabilities: LUN's short term assets ($803.2M) exceed its short term liabilities ($581.1M).

Long Term Liabilities: LUN's short term assets ($803.2M) do not cover its long term liabilities ($2.1B).


Debt to Equity History and Analysis

Debt Level: LUN's debt to equity ratio (7.9%) is considered satisfactory.

Reducing Debt: LUN's debt to equity ratio has reduced from 10% to 7.9% over the past 5 years.

Debt Coverage: LUN's debt is well covered by operating cash flow (128.5%).

Interest Coverage: LUN's interest payments on its debt are well covered by EBIT (7.4x coverage).


Balance Sheet

Inventory Level: LUN has a high level of physical assets or inventory.

Debt Coverage by Assets: LUN's debt is covered by short term assets (assets are 2.4x debt).


Next Steps

Dividend

What is Lundin Mining's current dividend yield, its reliability and sustainability?

1.53%

Current Dividend Yield


Dividend Yield vs Market

company1.5%marketbottom25%1.9%markettop25%5.4%industryaverage1.2%forecastin3Years1.8%

Current dividend yield vs market & industry

Notable Dividend: LUN's dividend (1.49%) isn’t notable compared to the bottom 25% of dividend payers in the Canadian market (1.88%).

High Dividend: LUN's dividend (1.49%) is low compared to the top 25% of dividend payers in the Canadian market (5.48%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, LUN has been paying a dividend for less than 10 years.

Growing Dividend: LUN's dividend payments have increased, but the company has only paid a dividend for 3 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (64.1%), LUN's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: LUN's dividends in 3 years are forecast to be thoroughly covered by earnings (13.3% payout ratio).


Next Steps

Management

What is the CEO of Lundin Mining's salary, the management and board of directors tenure and is there insider trading?

1.3yrs

Average management tenure


CEO

Marie Inkster (47yo)

1.3yrs

Tenure

US$3,148,807

Compensation

Ms. Marie Inkster is President and Chief Executive Officer of Lundin Mining Corporation since October 1, 2018 and has been its Director since September 30, 2018. She was Chief Financial Officer of Lundin M ...


CEO Compensation Analysis

Compensation vs Market: Marie's total compensation ($USD3.15M) is about average for companies of similar size in the Canadian market ($USD2.87M).

Compensation vs Earnings: Marie's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Management Age and Tenure

1.3yrs

Average Tenure

58yo

Average Age

Experienced Management: LUN's management team is not considered experienced ( 1.3 years average tenure), which suggests a new team.


Board Age and Tenure

12.0yrs

Average Tenure

64.5yo

Average Age

Experienced Board: LUN's board of directors are seasoned and experienced ( 12 years average tenure).


Insider Trading

Insider Buying: LUN insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellCA$149,20011 Nov 19
Jinhee Magie
EntityIndividual
Role
Chief Financial Officer
Senior VP & CFO
Shares20,000
Max PriceCA$7.46
BuyCA$119,03015 Aug 19
Peter Rockandel
EntityIndividual
Role
Head of Investor Relations
Senior Vice President of Corporate Development & Investor Relations
Shares20,000
Max PriceCA$5.95
BuyCA$890,80512 Aug 19
Nemesia S.A.R.L.
EntityCompany
Shares150,000
Max PriceCA$5.94
BuyCA$2,336,92008 Aug 19
Nemesia S.A.R.L.
EntityCompany
Shares400,000
Max PriceCA$5.84
BuyCA$2,623,81507 Aug 19
Nemesia S.A.R.L.
EntityCompany
Shares450,000
Max PriceCA$5.83
BuyCA$9,12830 Jul 19
Catherine Jean Stefan
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,400
Max PriceCA$6.52
SellCA$685,86101 May 19
Marie Inkster
EntityIndividual
Role
Chief Executive Officer
President
Shares93,467
Max PriceCA$7.34
SellCA$95,48005 Mar 19
J. Schauman
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Commercial
Shares14,000
Max PriceCA$6.82

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Marie Inkster (47yo)

    President

    • Tenure: 1.3yrs
    • Compensation: US$3.15m
  • Peter Rockandel

    Senior Vice President of Corporate Development & Investor Relations

    • Tenure: 1.3yrs
  • Steve Gatley (58yo)

    Vice President of Technical Services

    • Tenure: 7.6yrs
    • Compensation: US$1.19m
  • J. Schauman (60yo)

    Senior Vice President of Commercial

    • Tenure: 1yrs
    • Compensation: US$1.00m
  • Jinhee Magie

    Senior VP & CFO

    • Tenure: 1.3yrs
    • Compensation: US$1.11m
  • Lesley Duncan

    Special Project Manager

    • Annie Laurenson

      Corporate Secretary

      • Tenure: 1.8yrs
    • Andrew Hastings

      Senior VP & General Counsel

      • Tenure: 0.9yrs
    • Ciara Talbot

      Vice President of Exploration

      • Tenure: 1.8yrs
    • Jonas Peter Richardson

      Senior VP & COO

      • Tenure: 2.3yrs
      • Compensation: US$1.58m

    Board Members

    • Don Charter (63yo)

      Independent Director

      • Tenure: 13.3yrs
      • Compensation: US$135.08k
    • Lukas Lundin (61yo)

      Chairman of the Board

      • Tenure: 25.3yrs
      • Compensation: US$200.69k
    • Bill Rand (77yo)

      Lead Director

      • Tenure: 12yrs
      • Compensation: US$154.38k
    • John Craig (72yo)

      Non-Independent Director

      • Tenure: 16.6yrs
      • Compensation: US$119.65k
    • Marie Inkster (47yo)

      President

      • Tenure: 1.3yrs
      • Compensation: US$3.15m
    • Catherine Jean Stefan (66yo)

      Independent Director

      • Tenure: 4.7yrs
      • Compensation: US$135.08k
    • Dale Peniuk (60yo)

      Independent Director

      • Tenure: 13.3yrs
      • Compensation: US$138.94k
    • Peter Jones (71yo)

      Independent Director

      • Tenure: 6.3yrs
      • Compensation: US$131.22k
    • Jean-Claude Lalumiere

      Senior Vice President of Human Resources

      • Tenure: 1.8yrs
      • Compensation: US$1.22m

    Company Information

    Lundin Mining Corporation's company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Lundin Mining Corporation
    • Ticker: LUN
    • Exchange: TSX
    • Founded: 1994
    • Industry: Copper
    • Sector: Materials
    • Market Cap: CA$5.654b
    • Shares outstanding: 734.23m
    • Website: https://www.lundinmining.com

    Number of Employees


    Location

    • Lundin Mining Corporation
    • 150 King Street West
    • Suite 2200
    • Toronto
    • Ontario
    • M5H 1J9
    • Canada

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    LUNTSX (The Toronto Stock Exchange)YesCommon SharesCACADNov 1994
    GXDDB (Deutsche Boerse AG)YesCommon SharesDEEURNov 1994
    LUNM.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDNov 1994
    LUMISBATS-CHIXE (BATS 'Chi-X Europe')YesCommon SharesGBSEKNov 1994
    LUMIOM (OMX Nordic Exchange Stockholm)YesCommon SharesSESEKNov 1994
    0RQ9LSE (London Stock Exchange)YesCommon SharesGBSEKNov 1994

    Biography

    Lundin Mining Corporation, a diversified base metals mining company, engages in the exploration, development, and mining of mineral properties in Chile, the United States, Portugal, and Sweden. It primarily produces copper, zinc, and nickel, as well as gold, lead, silver, and other metals. The company holds 100% interests in the Eagle mine located in the United States; the Neves-Corvo mine located in Portugal; the Zinkgruvan mine located in Sweden, as well as 80% interest in the Candelaria and Ojos del Salado mining complex located in Chile; 24% interest in the Freeport Cobalt Oy business, which includes a cobalt refinery located in Kokkola, Finland; and the Chapada copper-gold mine located in Brazil. The company was formerly known as South Atlantic Ventures Ltd. and changed its name to Lundin Mining Corporation in August 2004. Lundin Mining Corporation was incorporated in 1994 and is headquartered in Toronto, Canada. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/17 01:46
    End of Day Share Price2020/01/16 00:00
    Earnings2019/09/30
    Annual Earnings2018/12/31


    Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.