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Analyst Research Report Snapshot


Reduced Multiples for the High 2014 Promises




PI Financial Corp


12 Dec 2013





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CORPORATE UPDATE December 12, 2013 COPPER MOUNTAIN MINING CORP. (T-CUM) $1.58 RATING: BUY TARGET: $2.00 (unchanged) (unchanged) Reduced Multiples for the High 2014 Promises VALUATION/RECOMMENDATION: We do not believe investors should pay for the high guidance given by management. However, given our production estimate increase, we are compensating investors with lower EV/EBITDA and P/E multiples. We are maintaining our BUY recommendation, SPECULATIVE risk and our target price of $2.00/share. Our target price is obtained by equally weighting a 6.0x P/E multiple (previously 7.0x) to our 2014 EPS estimate of $0.21/share and a 2.5x EV/EBITDA ratio (previously 3.0x) to our new 2014 EBITDA estimate of $61M. Our target price assumes a C$/US$ exchange rate at par. Our valuation is underpinned by our NAV estimate of CUM of $2.10/share. Company Statistics Risk: SPECULATIVE 52-week High/ Low: $4.27/$1.36 Shares Outstanding 124.6M (fd) Market Capitalization: $197M 3-Month Avg. Daily Volume: 395,139 Long-term debt: $304.2M Enterprise Value: $528M Financial Summary FYE Dec. 31) FY12e FY13e FY14e Revenue ($M) 229 229 271 Gross Profit ($M) 38 29 48 Adjusted FD EPS 0.19 (0.04) 0.21 Adjusted FD CFOPS $0.29 $0.15 $0.39 EPS fd ($/share) Q1 Q2 Q3 Q4 FY13e (0.02) (0.14) (0.11) 0.02 FY14e 0.05 0.05 0.05 0.05 CFOPS fd ($/share) Q1 Q2 Q3 Q4 FY13e (0.03) 0.06 0.11 0.06 FY14e 0.10 0.10 0.10 0.10 Corporate Information Copper Mountain Mining is a Canadian mining company operating its 75%-owned Copper Mountain Mine in Southern British Columbia. Copper Mountain Mining is the operator of the mine and Mitsubishi Materials Corporation, who has agreed to purchase all of the copper output from the mine, owns the remaining 25%.

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