Critical Survey: Lundin Mining (LUNMF) versus The Competition

Lundin Mining (OTC:LUNMF) is one of 113 publicly-traded companies in the “Metal mining” industry, but how does it weigh in compared to its peers? We will compare Lundin Mining to similar businesses based on the strength of its institutional ownership, profitability, risk, earnings, analyst recommendations, valuation and dividends.

Dividends

Lundin Mining pays an annual dividend of $0.28 per share and has a dividend yield of 3.3%. Lundin Mining pays out 77.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Metal mining” companies pay a dividend yield of 3.1% and pay out 82.8% of their earnings in the form of a dividend. Lundin Mining is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

0.1% of Lundin Mining shares are owned by institutional investors. Comparatively, 27.5% of shares of all “Metal mining” companies are owned by institutional investors. 0.4% of Lundin Mining shares are owned by company insiders. Comparatively, 12.9% of shares of all “Metal mining” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Lundin Mining and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lundin Mining	6.63%	5.02%	2.92%
Lundin Mining Competitors	-1,301.23%	-11.02%	-9.41%

Analyst Ratings

This is a breakdown of current ratings and price targets for Lundin Mining and its peers, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lundin Mining	0	1	0	0	2.00
Lundin Mining Competitors	1249	2681	3174	135	2.30

As a group, “Metal mining” companies have a potential upside of 23.11%. Given Lundin Mining’s peers stronger consensus rating and higher possible upside, analysts plainly believe Lundin Mining has less favorable growth aspects than its peers.

Risk & Volatility

Lundin Mining has a beta of 1.46, suggesting that its share price is 46% more volatile than the S&P 500. Comparatively, Lundin Mining’s peers have a beta of 1.04, suggesting that their average share price is 4% more volatile than the S&P 500.

Earnings & Valuation

This table compares Lundin Mining and its peers top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Lundin Mining	$3.39 billion	$241.56 million	23.78
Lundin Mining Competitors	$6.65 billion	$854.60 million	0.70

Lundin Mining’s peers have higher revenue and earnings than Lundin Mining. Lundin Mining is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Summary

Lundin Mining peers beat Lundin Mining on 8 of the 15 factors compared.

About Lundin Mining

LUNDIN MINING CORPORATION is a rapidly growing, diversified base metals mining company with operations in Portugal, Spain, Sweden and Ireland. The Company currently has six mines in operation producing copper, nickel, lead and zinc. In addition, Lundin Mining holds a development project pipeline which includes the world class Tenke Fungurume copper cobalt project in the Democratic Republic of Congo and the Ozernoe zinc project in Russia. The Company holds an extensive exploration portfolio and interests in international mining and exploration ventures.