Kepler Cheuvreux on Wednesday reduced its recommendation on Boliden (ST:BOL) to Hold from Buy in the run-up to the miner's fourth-quarter results. The broker simultaneously increased its one-year price target to SEK 640 from SEK 423, a move driven by higher assumed metal prices but one that now implies less than 2% upside from current market levels, according to analyst Boris Bourdet.
Bourdet said his updated valuation incorporates an upgraded price deck for copper and precious metals, a change that materially lifted his profit forecasts. He now projects Q4 2025 EBIT excluding process inventory revaluation at SEK 3.8 billion, up from SEK 2.8 billion in the third quarter. That figure is, however, roughly 5% below consensus expectations.
The analyst flagged several drivers behind the expected performance. He noted that continued healthy volumes across operations and a positive one-off contribution of SEK 400 million linked to a revaluation of Rönnskär inventories should bolster results. At the same time, Bourdet warned that higher seasonal costs and the absence of tailwinds present in the prior quarter are likely to offset some of those gains.
Breaking performance down by business area, Kepler anticipates solid smelter volumes following a strong third quarter. In mining, the broker expects both Tara and Aitik to narrowly meet their full-year guidance. Specifically, Tara is seen reaching its 1.6 million tonne production target, while Aitik is expected to deliver on head-grade assumptions.
Investor focus is also expected to centre on confirmation of the ramp-up at the expanded Odda facility after recent delays. Against a backdrop of sharply rising copper and precious metal prices, Bourdet added, management may be pressed on the mid-term price assumptions underpinning the company outlook.
Responding to the rise in metal prices, Bourdet raised his copper assumption from $10,000 per tonne to $12,000 per tonne from 2026 onwards. He said the higher price deck led to upward revisions of around 20-25% to Kepler's EPS estimates.
Despite boosting the target to SEK 640, Kepler concluded the recent share-price rally has reduced prospective upside, prompting the downgrade to Hold. The broker's view is predicated on the combination of an improved pricing outlook and limited potential for additional share appreciation from current levels.
Sectors affected: Mining, Metals and Mining Equipment, Commodities.