After a rocky few years, First Quantum Minerals (FM +1.73%) may be poised for a rebound. The Canadian mining giant, known for being one of the world's largest copper producers, has seen its shares tumble more than 30% from July 28, 2023, through today.
The culprit? The shutdown of its crown jewel asset, the Cobre Panama mine.
Certainly not good news. But as investors know, sometimes the best opportunities hide behind the darkest headlines.
This setback might be hiding an interesting comeback story. With copper supply and demand remaining tight, Cobre Panama discussions ongoing, and the stock price suggesting the worst-case scenario, First Quantum could be a chance for patient investors to buy low.
Image source: Getty Images.
A copper-centric powerhouse
First, Quantum makes its money in a straightforward way: mining copper and other metals out of the ground, then selling them.
TSX: FM
Key Data Points
The red metal is essential for everything from power grids to electric vehicles (EVs), playing a critical role in the global shift from fossil fuels toward cleaner, low-carbon energy sources like renewables and electrification to meet growing demand while reducing emissions.
Before the Panama shutdown in 2022, First Quantum produced almost 776,000 tonnes of copper, bringing in C$7.3 billion in revenue. About 40% of that came from Cobre Panama.
While the company also mines nickel and gold, copper makes up over 80% of their total revenue, making it essential to their business.
Importantly, First Quantum isn't a one-mine story. Its operations stretch across Zambia, Australia, and Spain. Mines like Kansanshi and Sentinel in Zambia continue to produce solid output, cushioning the blow from Panama. In fact, in Q2 2025, the company still managed more than 90,000 tonnes of copper production, demonstrating the resilience of its broader portfolio.
The Panama disaster
The sell-off traces back to November 2023, when Panama's Supreme Court ruled the Cobre Panama contract unconstitutional following widespread protests over environmental concerns. The ruling forced the mine's closure, yanking 1.5% of global copper supply offline. For First Quantum, it was devastating, with nearly half its market capitalization vanishing overnight.
Cobre Panama wasn't just any mine. It was a $10 billion investment, one of the world's largest copper operations, and responsible for 5% of Panama's GDP. The shutdown triggered layoffs, a dividend suspension, and a massive debt restructuring.
Today, First Quantum's stock sits around C$26, well below levels seen before the closure.
Arbitration hearings are scheduled for 2026, with First Quantum seeking $20 billion in damages. However, investors can't ignore the uncertainty here.
Looking through the noise
Despite the legal problems, recent events suggest things might be improving. Panama's economy is under pressure; GDP growth slowed from 7.5% in 2022 to just 2.5% in 2024, and credit ratings have been lowered.
The new president, José Raúl Mulino, is loosening his stance, allowing the sale of stored copper concentrate and ordering an environmental audit that could lead to the mine reopening. It's clear that Panama's financial income heavily relied on the Cobre Panama mine.
First Quantum even halted its arbitration process in March 2025, suggesting that a settlement might be possible.
Investors should remember that this isn't First Quantum's first rodeo in international disputes. In 2019, the company successfully secured $1.25 billion in compensation from the Democratic Republic of Congo, underscoring its ability to navigate tough legal waters.
Copper demand is booming
Even without Panama, First Quantum has strong tailwinds. Copper demand is surging thanks to EV adoption, renewable power, and data centers that underpin the artificial intelligence (AI) boom.
EVs require roughly four times more copper than traditional vehicles, and the International Energy Agency (IEA) estimates a supply demand gap by 2035, with mines meeting only 70% of global needs.
That's already showing up in prices. Copper trades around $9,700 per tonne today, with room to rally further. Against that backdrop, First Quantum's African assets look increasingly valuable. The Kansanshi S3 expansion in Zambia is set to boost output by 2026, positioning the company to ride higher prices.
Valuation is cheap
Here's where it gets interesting for investors. First Quantum trades at a price-to-book ratio of just 1.3x and a forward EV/EBITDA (earnings before interest, taxes, depreciation, and amortization) of 10x. I'd prefer to look at EV/EBITDA over P/E, given differing debt levels among global miners and the fact that large depreciation figures skew reported earnings.
By contrast, other copper-centric miners like Capstone Copper (CSCC.F +4.28%) (P/B 1.7x, EV/EBITDA 10x) and Southern Copper (SCCO +0.76%) (P/B 7.9x, P/E 12x) trade at clear premiums.
This discount reflects Cobre Panama uncertainty, but arguably overlooks First Quantum's diversified production base and the powerful copper cycle ahead. That's not to mention that the loss of Cobre Panama is reflected in forward-looking estimates already -- pointing to significant upside should those volumes return.
So is First Quantum a buy?
First Quantum isn't for the faint of heart, but that's exactly why it could pay off. With copper demand poised to climb and the stock trading at a steep discount, today's uncertainty might be tomorrow's opportunity hiding in plain sight.
