If you're of a nervous disposition, look away now. The idea of investing in a miner whose principal product is trading at a five-year low may seem preposterous to some. But we think there is a genuine investment case for Chilean copper miner Antofagasta (ANTO) despite prevailing sentiment towards commodity stocks.
IC TIP:
Buy
at
697p
Tip style
Speculative
Risk rating
High
Timescale
Long Term
Bull points
- Copper surplus could be overstated
- Strong dividend record
- Robust balance sheet
- On track to hit 2014 guidance
Bear points
- Copper market in surplus
- China's lending market
Antofagasta, a FTSE 100 miner controlled by Chile's Luksic family, is one of the world's largest copper producers with activities mainly centred on Chile, where it operates four copper mines: Los Pelambres, El Tesoro, Michilla and Esperanza. The group also generates substantial revenues from by-product sales and has ancillary rail and water businesses.