Fresnillo Shares Surge as Profit Soars – Is It Still a Top FTSE 100 Stock to Buy?
Fresnillo shares grabbed attention on August 5 when they surged 8% after stellar half-year results. The company reported a 27.1% jump in adjusted revenues to $1.98 billion and a net profit increase of nearly 300% to $467.6 million. Investors wonder if this stock market star still shines as a top FTSE 100 pick.
This surge stems from higher precious metal prices, despite selling less gold and silver. Production costs dropped over 20% to $673.5 million, boosting profits and leaving Fresnillo with £1.82 billion in cash. For stock market fans, an investment of £10,000 two years ago would now be worth £30,000, crushing the FTSE 100 average.
Why Fresnillo Shares Are Soaring
The financials tell a clear story. Adjusted revenues hit $1.98 billion, up 27.1%, thanks to strong gold and silver prices. Even with lower sales volumes, Fresnillo thrived.
Production costs fell to $673.5 million, a drop of more than 20%. This efficiency fueled a net profit of $467.6 million, almost 300% higher than in 2024’s first half.
A cash pile of £1.82 billion signals strength. This lets Fresnillo invest or handle tough times, making Fresnillo shares a standout in the stock market.
Beating the Stock Market: Fresnillo’s Big Wins
Fresnillo shares have delivered huge gains. A £10,000 investment from two years ago grew to £30,000, far outpacing a FTSE 100 tracker fund.
In 2025, Fresnillo’s value rose 142%, topping Rolls-Royce’s 86% gain. This performance marks it as a stock market leader among FTSE 100 names.
Key Stats at a Glance
Here’s a quick look at Fresnillo’s numbers:
- Share Price Jump: 8% on August 5
- Revenue Growth: 27.1% to $1.98 billion
- Net Profit: Up 300% to $467.6 million
- Cash Reserves: £1.82 billion
- Two-Year Return: £10,000 to £30,000
The rally in Fresnillo shares reflects solid profits and smart cost cuts. Still, a lofty valuation and unpredictable stock market winds call for careful thought. Research matters before jumping in.
Fresnillo’s Bright Outlook
Management boosted its full-year gold production target to 550,000-590,000 ounces, up from 525,000-580,000 ounces. Better results at the Herradura mine drove this change.
Higher output could mean more profits if gold prices hold. This optimism keeps Fresnillo shares appealing to stock market watchers.
Risks to Watch with Fresnillo Shares
The stock trades at 17 times forecast earnings, high for the Basic Materials sector. This valuation leaves little room for mistakes.
Precious metal demand swings with geopolitics. Gold hit record highs, but a dip could hit Fresnillo shares hard in the stock market.
Should You Buy Fresnillo Shares Now?
Fresnillo shares shine with strong profits and cash reserves. Yet, the high price and volatile metals market suggest caution.
For current holders, selling some shares might lock in gains. New buyers face a tougher call, balancing growth against risks.
Disclaimer:
This is for information only, not financial advice. Always do your research.