Seeking Alpha: Delays And Soft Guidance Dent HudBay, But There's Still Value Here

I wrote about HudBay (HBM) as an Alpha-Rich investment candidate back in July of this year, and with the stock up more than 20% (against 8% for the S&P 500), it has been a decent call. To be fair, though, picking a beaten-down mining stock in the summer of this year was a good move in general and investors in companies like Teck (TCK), Freeport McMoRan (FCX), and Rio Tinto (RIO) have also done pretty well over that same period.

I continue to believe that HudBay is a well-run and substantially undervalued mining company with high-value assets like Constancia (CP) and Lalor Lake (Lalor) likely to significantly increase production, revenue, and profits in the coming years. Unfortunately, while the stock has worked reasonably well, the company has seen some of the construction and development setbacks that are common to the industry. Higher costs at Lalor, cost overruns at CP, and some shuffling around of capex priorities do lead me to trim my NAV estimate for the stock, but I still believe this is a significantly undervalued stock.

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Delays And Soft Guidance Dent HudBay, But There's Still Value Here