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Antofagasta (full-year earnings 14 March)
Like many mining stocks, Antofagasta has rallied strongly over the past year, but in the last couple of months we have seen around 17% shaved off the share price. However, the improved pricing outlook seems to offer better times ahead. Cost-cutting and a reduction in operations has helped to ease the pressure on margins, and the expectation is that pre-tax profit will surge to over £700 million in 2016, from just over £200 million a year earlier. In addition, dividends are expected to recover as the miner seeks to return cash to shareholders. Moreover, dividend cover is 2.9 times so there is little risk of a drop in payouts any time soon.
The pullback over the past month or so has put a dent in the uptrend, but leaves it intact. Any recovery back above £7.80 would be the signal that the dip is over and more gains are on the way. A daily close below £7.22 would suggest further weakness, in the direction of £6.50.