Top Copper Stocks for Q4 2022

LUN.TO, FM.TO, and TRQ are top for value, growth, and performance, respectively

The copper industry is composed of companies involved in the exploration, extraction, development, and production of copper, one of the most widely used metals. Copper demand is closely tied to economic cycles as it's used for a broad range of applications, including construction, electronics, industrial machinery, transportation, power generation, and transmission. Market participants looking to invest in copper have several options. They can hold it in the physical form through buying copper bullion bars or coins; they can buy copper futures; they can buy copper ETFs, or mutual funds that include copper and other precious metals; and they can also buy copper stocks directly.

The largest names in the sector include Freeport-McMoRan Inc., Australia-based OZ Minerals Ltd., and China-based Zijin Mining Group Co. Ltd.

Copper stocks, represented by the Global X Copper Miners ETF (COPX), have underperformed the broader market. COPX has provided a total return of -15.5% over the past 12 months, below the -10.7% return for the S&P 500 over the same period. These market performance figures and all statistics in the tables below are as of Sept. 13, 2022.

Here are the top three copper stocks with the best value, the fastest growth, and the best performance. These are stocks of companies that mine for copper, rather than futures that track the copper commodity.

Best Value Copper Stocks

These are the copper stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows you’re paying less for each dollar of profit generated.

Best Value Copper Stocks
  Price ($) Market Cap ($B) 12-Month Trailing P/E Ratio
Lundin Mining Corp. (LUN.TO) CA$7.24 CA$5.6 6.0
Ero Copper Corp. (ERO.TO) CA$14.33 CA$1.3 6.4
Capstone Copper Corp. (CS.TO) CA$3.14 CA$2.2 6.7

Source: YCharts

  • Lundin Mining Corp.: Lundin Mining is a Canada-based company that engages in the mining and exploration of copper, zinc, gold, and nickel and other metals as well as the development of mineral properties in Chile, Brazil, Portugal, Sweden, and the U.S. It also trades over the counter (OTC) in the U.S. under the ticker LUNMF. The company said that a sinkhole developed near its Alcaparrosa mine at the Minera Ojos del Salado operation in Chile on July 30. As of the company's latest report on Aug. 18, operations at the mine remained suspended.
  • Ero Copper Corp.: Ero Copper is a Canada-based mining company that engages in the production and sale of copper, gold, and silver in mining locations primarily in Brazil. The company also has shares that trade on the New York Stock Exchange (NYSE) in the U.S. under the ticker ERO.
  • Capstone Copper Corp.: Capstone Copper is Canada-based copper mining company. Its operations are primarily in the U.S., Mexico, and Chile. Capstone also has shares trading over the counter in the U.S. under the ticker CSCCF. On Aug. 25, Capstone announced that its Mantos Blancos and Mantoverde operations in Chile had committed to the Copper Mark, a United Nations framework promoting responsible production practices and sustainable development. The Copper Mark currently covers six of the 10 largest copper-producing companies worldwide.

Fastest Growing Copper Stocks

These are the top copper stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly YOY percentage revenue growth and their most recent quarterly YOY earnings-per-share (EPS) growth. Both sales and earnings are critical factors in the success of a company. Therefore ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one or the other figure unrepresentative of the business in general. Companies with quarterly EPS or revenue growth of over 2,500% were excluded as outliers.

Fastest Growing Copper Stocks
  Price ($) Market Cap ($B) EPS Growth (%) Revenue Growth (%)
First Quantum Minerals Ltd. (FM.TO) CA$23.49 CA$16.3 211.5 11.0
Capstone Copper Corp. (CS.TO) CA$3.14 CA$2.2 -4.8 76.9
Turquoise Hill Resources Ltd. (TRQ) 30.96 6.2 -19.6 21.9

Source: YCharts

  • First Quantum Minerals Ltd.: First Quantum Minerals is a Canada-based mining company that explores for and produces copper, nickel, gold, silver, zinc, and acid. First Quantum operates mines in countries including Turkey, Spain, Finland, and Zambia. It also has shares that trade OTC in the U.S. under the ticker FQVLF. First Quantum reported Q2 2022 earnings results on July 26. Net earnings attributable to company shareholders roughly tripled year-over-year (YOY) on rising revenue. The company said that COVID-19 restrictions had largely eased, although high inflation and a global economic slowdown negatively impacted performance.
  • Capstone Copper Corp.: See above for company description.
  • Turquoise Hill Resources Ltd.: Turquoise Hill Resources is a Canada-based mining company engaged in the exploration and development of mineral and metal properties in Asia and Australia. Its principal property is the Oyu Tolgoi copper and gold mine in southern Mongolia. On Aug. 4, Turquoise Hill reported Q2 2022 earnings results. Income for the period declined by 27% YOY as revenue increased. Copper and silver revenues rose YOY, while gold revenue growth remained essentially flat.

Copper Stocks With the Best Performance

These are the copper stocks that had the best returns or smallest declines in total return over the past 12 months out of the companies we looked at.

Copper Stocks with the Best Performance
  Price ($) Market Cap ($B) 12-Month Trailing Total Return (%)
Turquoise Hill Resources Ltd. (TRQ) 30.96 6.2 103.7
First Quantum Minerals Ltd. (FM.TO) CA$23.49 CA$16.3 -1.8
Freeport-McMoRan Inc. (FCX) 31.05 44.4 -10.7
Russell 1000 N/A N/A -10.7
Global X Copper Miners ETF (COPX) N/A N/A -15.5

Source: YCharts

  • Turquoise Hill Resources Ltd.: See above for company description.
  • First Quantum Minerals Ltd.: See above for company description.
  • Freeport-McMoRan Inc.: Freeport-McMoRan engages in the mining of copper, gold, and molybdenum. The company has mining operations in both North and South America as well as Indonesia.

Trends in Copper Stocks

Demand for copper will likely rise steadily, as it is a critical element in the energy transition because the metal is used in electric vehicles, charging stations, wind turbines, and solar panels. The price of copper is largely influenced by the health of the global economy, which can be variable. This is due to copper's widespread applications in all sectors of the economy, as mentioned, and also in construction, factory equipment, and electronics.

The base metal is seen as a reliable leading indicator. A rising market price suggests strong economic health, while a decline suggests the opposite. For example, after rising above $10,000 per metric ton in March 2022 after Russia invaded Ukraine and copper shortages emerged, by the second half of the year, as global recession fears took hold, copper prices headed in the opposite direction.

Risks of Copper Stock Investing

Some risk factors to be aware of when considering investing in copper stocks are commodities prices' overall tendency to be much more volatile than traditional stock prices and the environmental risks posed by copper mining.

Growing focus on sustainability may force copper miners to use more expensive methods to extract the metal and could add to world supply shortage. In 2020, for instance, Anglo-Australian copper miner Rio Tinto Plc (RIO) took a hit from environmental, social and corporate governance (ESG) investors when it blew up a place sacred to indigenous people in Australia, and the CEO and two other executives were fired.

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  1. YCharts. "Financial Data."

  2. Lundin Mining Corp. "Lundin Mining Provides Update on Investigations at Ojos del Salado Operation."

  3. Capstone Copper Corp. "Capstone Copper’s Mantos Blancos and Mantoverde Mines Join the Copper Mark."

  4. First Quantum Minerals Ltd. "FIRST QUANTUM MINERALS REPORTS SECOND QUARTER 2022 RESULTS," Pages 1 and 3.

  5. Turquoise Hill Resources Ltd. "Turquoise Hill announces financial results and review of operations for the second quarter of 2022."

  6. YCharts. "Copper Price."

  7. CNN. "Rio Tinto CEO Resigns After Destruction of 46,000-Year-Old Sacred Indigenous Site."

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