UBS Backs Copper Expansion Play in Anglo American and Freeport-McMoRan

UBS analysts are advising investors to buy shares in several major mining companies as they position themselves for copper expansion. According to UBS, diversified mining groups like Anglo American and Freeport-McMoRan are shifting their capital allocation strategies towards copper production to increase market valuations.

In a research report, UBS analyst Daniel Major noted that major miners navigated their first-half financial results without severe guidance downgrades despite persistent cost inflation. However, BHP faces challenges due to copper bottlenecks, earning it a neutral rating from the investment bank with a price target of £29.50.

UBS maintained a buy recommendation on Anglo American with a £46 price target after the company announced its plan to sell DeBeers and focus on growing output by up to 50% over five years. Similarly, Freeport-McMoRan also received a buy rating with a $77 price target due to an encouraging operational recovery at the Grasberg mine in Indonesia.