Antofagasta plc (LON: ANTO), the Chilean copper mining company, has seen its share price target cut twice by Scotiabank this week.
The investment bank has cited weaker global demand for copper and mixed half-year financial results as factors contributing to the downward revisions.
![Antofagasta mining operations](https://www.asktraders.com/wp-content/uploads/2023/11/Antofagasta-mining-operations.png)
On Monday, Scotiabank reduced its price target on Antofagasta to 21.50p from 24p. The firm attributed this decision to a lowered near-term commodity price outlook, reflecting the impact of weaker global demand on the copper market.
Just two days later, on Wednesday, the bank further lowered its price target to 21 GBp. This revision followed the release of Antofagasta's half-year results, which Scotiabank described as “mixed.” Scotiabank maintained a Sector Perform (Neutral) rating on the stock.
While the company reaffirmed its full-year operating guidance, the analyst noted that the overall update was neutral for the shares.
Despite the price target cuts, Antofagasta's half-year results demonstrated resilience. The company reported a 2.3% increase in revenue to just under $3 billion and a 4.8% increase in EBITDA for the period to $1.4 billion.
Copper production was slightly lower year-on-year, but cash costs remained relatively stable. However, the company also cut its interim dividend by 32.5%.
Antofagasta's growth plans remain on track, with the Centinela Second Concentrator project progressing ahead of schedule and initial work starting on new Los Pelambres projects. The company also maintained a strong balance sheet and cash flow generation.
However, the ongoing challenges in the copper market, coupled with the mixed half-year results, have led Scotiabank to lower its valuation of Antofagasta. Overall, Scotiabank sees the company's latest update as neutral for the shares.
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