Capstone Copper Stock Trades at Discount Despite Record Cash Flow

Capstone Copper (TSX:CS) stock closed at CA$13.31 on Friday after another record quarter of cash generation, yet its share price remains far below a discounted cash flow estimate of CA$78.10 and some analyst target ranges.

The company's adjusted EBITDA hit a record US$354 million in the second quarter, with net debt running at only 0.5x EBITDA, showing that its core portfolio currently funds itself.

One clear operational proof point is Mantoverde, where throughput ran about 13% above design and C1 cash costs reached a record low of US$1.97/lb, supporting the claim that asset optimization can lift margins.

Bears argue that Capstone Copper is stretched on execution, with big growth projects at risk of cost overruns and weaker margins if input costs stay high.