ASX:MAC
Mac Copper CDI
Investment Summary
The fund managers believe that Metals Acquisition Corporation (MAC) represents a compelling investment opportunity within the copper sector. They highlight its position as the only pure-play copper producer on the ASX, with a market cap of $1.3 billion and a strategic focus on operating high-grade mines. Under the leadership of an experienced management team, MAC is expected to present significant growth opportunities, despite short-term fluctuations in the copper market. They note that recent quarterly results were impressive, but weaker copper prices may impact the outlook, resulting in increased capital expenditure and unit costs. Nevertheless, fund managers view the recent price volatility as a short-term issue and maintain a positive long-term outlook, emphasizing that MAC's cash cost reductions could lead to an estimated A$250 million gross profit for FY24E based on current prices. In conclusion, the fund managers remain committed to MAC, believing it has strong growth potential in alignment with the electrification trend.
Commentary From The Managers
Endeavor Asset Management
31 July 2024
$19.50
- Endeavor Asset Management noted that copper miner Metals Acquisition (MAC) reported impressive quarterly results.
- However, this performance was overshadowed by a weaker copper price.
- The near-term outlook suggests an increase in capital expenditure.
- There are also indications of higher unit costs.
- Endeavor Asset Management decided to exit the position due to a full spot valuation in light of the weakening copper price.
Blackwattle Investment Partners
30 June 2024
$19.88
- Blackwattle Investment Partners is updating their investment thesis on Mac Copper CDI.
- Metals Acquisition Ltd listed on the ASX in February and focuses on acquiring quality mines.
- Its mandate involves operations in critical jurisdictions for electrification and decarbonisation efforts.
- The first asset is the CSA copper mine in Cobar, NSW, noted for being one of the highest-grade copper mines in Australia.
- Management aims to increase production and reduce costs to enhance profitability.
- The share price experienced a -12% decline in June due to fluctuations in copper prices, viewed as short-term volatility.
- Blackwattle Investment Partners remains positive on MAC’s long-term outlook.
Endeavor Asset Management
28 Feb 2024
$18.80
- Endeavor Asset Management bought into Metals Acquisition Corporation (MAC) at $17 per share, experiencing a 10% increase since entry.
- MAC is listed on the ASX, with a market capitalization of $1.3 billion and an enterprise value of $1.2 billion.
- It is the only pure-play copper producer on the ASX.
- MAC operates the highest grade copper mine in Australia, located in NSW.
- The IPO raised was offered at a 10% discount to its US-listed shares.
- Guided by a highly experienced management team, MAC is positioned for significant organic and inorganic growth opportunities.
- The management team shows strong alignment with shareholder interests.
- Since acquiring the project, MAC has significantly reduced cash costs, projecting A$250 million in gross profit for FY24E based on current spot prices.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.