Key Takeaways:
- BofA Securities raised MMG's target price to HK$12 from HK$10.5, reiterating Buy.
- MMG's 1H26 net profit surged 164 percent year over year to US$897 million.
- Management cut 2026 C1 cash cost guidance to US$0.85-1.05 per pound.
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BofA raises MMG target to HK$12 on record first-half profit
Bank of America Securities raised MMG's price target to HK$12 from HK$10.5, reiterating its Buy rating after the copper miner posted a record first-half profit.
"During the first half we delivered some outstanding financial and production outcomes, including a record profit after tax of US$1.36 billion and record operating cash flow," Ivo Zhao, MMG's chief executive, said.
MMG's revenue rose 61 percent year over year to US$4.54 billion in the first half, while net profit attributable to shareholders surged 164 percent to US$897 million, exceeding the broker's expectations and reaching 54 percent of the market's full-year 2026 forecast. EBITDA climbed 77 percent to US$2.73 billion, with the Las Bambas project in Peru contributing about US$2.25 billion. Copper production increased 3 percent to 266,500 tonnes, equivalent to 52 percent of full-year guidance. Management cut its 2026 C1 cash cost guidance to US$0.85-1.05 per pound from US$1.2-1.4, after Las Bambas delivered a C1 cost of US$0.55 per pound in the first half.
The balance sheet improved sharply, with net debt falling to US$608 million from US$3.35 billion at the end of 2025 and net gearing dropping to 6 percent from 33 percent. BofA raised its 2026-2028 earnings forecasts by 16 percent to 22 percent, citing stronger-than-expected results and the balance sheet improvement. The broker remains positive on copper, noting output from the world's top 15 miners fell 5 percent year over year in the first half while China's power grid investment rose 13 percent.
The stock traded down 3.5 percent on the day to about HK$8.87, implying roughly 35 percent upside to the new target. MMG did not declare an interim dividend.
BofA said copper supply and demand fundamentals continued to improve. Tightening scrap copper supply in China led July refined copper output to come in 4 percent below forecasts made at the start of the year. Given limited supply flexibility, the broker remains positive on the copper price outlook.
The company maintained its 2026 production guidance, forecasting copper output between 493,000 and 528,000 tonnes and zinc output between 215,000 and 235,000 tonnes. Las Bambas is expected to produce up to 400,000 tonnes of copper in 2026.
The target raise shows BofA expects MMG's earnings momentum to continue through the year. Investors will watch second-half production and cost performance, with capital expenditure guided at US$1.6 billion to US$1.7 billion for 2026.
This article is for informational purposes only and does not constitute investment advice.
[1] ＜Research＞ BofAS Raises MMG (01208.HK) TP to HKD12 on Strong 1H26 Results[2] Hong Kong Stock Market Movement | MMG Limited (1208.HK) opens more than 5% higher, with net profit for the first half surging 164% year-on-year, reaching a record-high level.[3] MMG Announces 2026 Interim Results[4] Earnings call transcript: MMG posts record H1 2026 profit as shares ease 1.3%[5] AASTOCKS HK Stock Quote
