Investors interested in Basic Materials stocks should always be looking to find the best-performing companies in the group. Has Nexa Resources S.A. (NEXA) been one of those stocks this year? By taking a look at the stock's year-to-date performance in comparison to its Basic Materials peers, we might be able to answer that question.Nexa Resources S.A. is one of 254 individual stocks in the Basic Materials sector. Collectively, these companies sit at #9 in the Zacks Sector Rank. The Zacks Sector Rank consider ...

1. Report Industry Investment Rating - No relevant information provided in the content 2. Core Viewpoints of the Report - The global zinc mine expansion cycle is nearing its end, and production disruptions are increasing, resulting in limited incremental space. In 2026, the global zinc mine output is expected to increase by about 150,000 tons, with the incremental projects concentrated in a few large - scale projects that were ramping up in the previous period [4]. - The global zinc concentrate supply - demand balance is tightening. Under the neutral scenario, a tight balance of zinc mines may become the norm, the TC operation center is expected to decline, and the zinc price operation center is expected to rise [9]. 3. Summary According to Relevant Catalogs 3.1 Global Zinc Mine Project Tracking - **2025 Global Zinc Mine Production**: In 2025, the global zinc mine output increased by 641,000 tons, a year - on - year increase of 5.37%, with the increment concentrated overseas. The production increase was mainly in Peru, Congo (Kinshasa), China, South Africa, Ireland, and Europe, while the decrease was mainly in the United States and Brazil [7]. - **2026 Global Zinc Mine Output Forecast**: Based on production schedules and production guidance, the global zinc mine increment in 2026 is estimated to be about 150,000 tons. The projects expected to contribute definite increments include Vedanta's Gamsberg Phase II, Ivanhoe's Kipushi project in Congo (Kinshasa), and the continuous realization of the increment from Russia's Ozernoye mine. Additionally, China's Huoshaoyun lead - zinc mine may add 150,000 - 200,000 metal tons in 2026 [4]. 3.2 Production Situation of Important Listed Mining Enterprises in Q4 - **Vedanta**: In Q4 2025, the zinc mine production was 335,000 tons, a quarter - on - quarter increase of 5.35% and a year - on - year increase of 7.72%, mainly driven by the increment of HZL and Gamsberg. The 2026FY production guidance was raised to 1.35 - 1.4 million tons, a slight increase compared to 2025FY. The bottleneck transformation of Chanderiya and Dariba refineries was completed in this quarter [12]. - **Glencore**: In Q4 2025, the zinc resource output was 260,000 tons, a quarter - on - quarter increase of 6.47% and a year - on - year decrease of 0.54%. The 2026 annual production guidance was lowered to 700,000 - 740,000 tons. The C1 cost decreased in 2025, and future capital expenditure will focus on copper and coal projects [19]. - **Teck**: In Q4 2025, the zinc mine production was 157,200 tons, a quarter - on - quarter increase of 4.45% and a year - on - year increase of 7.41%, mainly due to the increase in Antamina's production. The 2026 cost guidance increased, and the Red Dog MLE project is in progress [20][24]. - **Zijin Mining**: In Q4 2025, the zinc mine production was 128,900 tons, a quarter - on - quarter increase of 40.87% and a year - on - year increase of 41.13%. The 2026 - 2028 production plan aims to stabilize and increase zinc output, but the unit sales cost increased in the reporting period [25]. - **Nexa**: In Q4 2025, the zinc mine production was 91,200 tons, a quarter - on - quarter increase of 8.96% and a year - on - year increase of 22.51%. The 2026 capital expenditure is expected to increase, and the zinc mine cash cost in 2026 is expected to rise [28]. - **Peñoles**: In Q4 2025, the zinc mine production was 69,300 tons, a quarter - on - quarter increase of 9.70% and a year - on - year increase of 13.31%, mainly due to the resumption of Tizapa's production. The 2025 mine cash cost mostly decreased, and the enterprise's CAPEX is expected to slightly decline [35]. - **Volcan**: In Q4 2025, the zinc mine production was 59,400 tons, a quarter - on - quarter decrease of 0.67% and a year - on - year decrease of 7.19%. The Q4 2025 mine cost increased, and the capital expenditure increased significantly [36][39]. - **MMG**: In Q4 2025, the zinc mine production was 65,400 tons, a quarter - on - quarter increase of 11.29% and a year - on - year increase of 2.3%. The 2026 production guidance was slightly lowered, and the 2026 CAPEX is expected to be 1.6 - 1.7 billion US dollars, mainly focused on non - zinc projects [43]. - **Boliden**: In Q4 2025, the zinc mine production was 91,800 tons, a quarter - on - quarter decrease of 15.01% and a year - on - year decrease of 1.97%. The 2026 annual CAPEX is expected to be 15 billion Swedish kronor [44]. - **Newmont**: In Q4 2025, the zinc mine production was 46,000 tons, a quarter - on - quarter decrease of 22.03% and a year - on - year decrease of 40.26%. The 2026 unit cost is expected to increase, and the 2026 annual CAPEX is expected to be 3.35 billion US dollars [52]. - **Ivanhoe**: In Q4 2025, the zinc mine production was 61,400 tons, a quarter - on - quarter increase of 7.42% and a year - on - year increase of 89.12%. The 2026 production guidance is 240,000 - 290,000 tons. The 2026 Kipushi C1 cost is expected to be between 0.85 - 0.95 $/lb, and the capital expenditure is expected to be 60 million US dollars [55].

Company Overview - Sibanye Stillwater is a leading South African gold miner that also produces platinum, with significant stock performance, increasing over 230% in the past year, indicating strong investor interest in international gold exposure [2][6] - The company is projected to have explosive earnings growth, with an estimated 692% EPS growth and a forward P/E ratio of 3.31, making it a compelling investment option [6] Market Trends - Gold prices are currently above $2,800 per ounce, and there is rising demand for battery metals driven by electrification and AI infrastructure expansion, contributing to margin expansion and earnings acceleration across mining companies [5] - The overall commodities trend is favorable, with companies like Nexa Resources and Aura Minerals also showing strong projected earnings growth, indicating a robust market environment for commodity miners [9][12] Investment Outlook - The medium and long-term outlook for Sibanye remains strong, supported by solid Q4 results and increased operating margins due to cost discipline in a rising commodity price environment [8] - The company is positioned well for long-term growth, especially for investors bullish on gold prices, suggesting it is a stock worth considering for investment [16]

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or ...

Core Viewpoint - Investors are evaluating Nexa Resources S.A. (NEXA) and Anglo American (NGLOY) to determine which stock represents a better undervalued investment opportunity [1] Group 1: Zacks Rank and Earnings Estimates - NEXA has a Zacks Rank of 1 (Strong Buy), while NGLOY has a Zacks Rank of 2 (Buy), indicating that NEXA is likely experiencing a more favorable earnings outlook [3] - The Zacks Rank focuses on companies with positive earnings estimate revisions, suggesting that NEXA's earnings outlook is improving more significantly than NGLOY's [3] Group 2: Valuation Metrics - NEXA's forward P/E ratio is 6.60, significantly lower than NGLOY's forward P/E of 25.86, indicating that NEXA may be undervalued relative to NGLOY [5] - NEXA has a PEG ratio of 0.13 compared to NGLOY's PEG ratio of 0.60, suggesting that NEXA's valuation is more attractive when considering expected earnings growth [5] - NEXA's P/B ratio is 1.15, while NGLOY's P/B ratio is 1.99, further supporting the notion that NEXA is undervalued [6] Group 3: Overall Valuation Grade - NEXA has received a Value grade of B, while NGLOY has a Value grade of C, indicating that NEXA is viewed more favorably by value investors based on its valuation metrics [6] - Stronger estimate revision activity and more attractive valuation metrics position NEXA as the superior option for value investors at this time [7]

Group 1 - Nexa Resources S.A. reported strong fourth-quarter and full-year 2025 results, with earnings per share of $0.60, nearly 20% higher than expected, and revenue of $903 million, exceeding estimates by 16.5% [1] - Adjusted EBITDA reached $300 million in Q4, representing a 61% increase quarter-over-quarter and a 53% increase year-over-year, with the adjusted EBITDA margin rising to 33% from 24% in Q3 2025 and 27% in Q4 2024 [2] - The mining division demonstrated solid cost performance, with cash expenditures net of by-products at -$0.58 per pound and cost per standard mining ore at $56.40 per ton, both meeting or exceeding expectations [2] Group 2 - Nexa Resources operates in the global zinc mining and smelting industry, with a diverse portfolio that includes six polymetallic mines located in Peru and Brazil [3] - The company emphasizes sustainable growth through high-return assets that produce copper, lead, and zinc, along with other by-products [3]

Group 1 - Nexa Resources S.A. (NEXA) is a notable stock within the Basic Materials sector, which consists of 255 individual stocks and holds a Zacks Sector Rank of 3, indicating its relative strength among sector groups [2] - The Zacks Rank system, which focuses on earnings estimates and revisions, currently rates Nexa Resources S.A. as 1 (Strong Buy), suggesting a positive outlook for the stock [3] - In the past quarter, the Zacks Consensus Estimate for NEXA's full-year earnings has increased by 108.2%, reflecting improved analyst sentiment and a favorable earnings outlook [4] Group 2 - Year-to-date, Nexa Resources S.A. has gained approximately 29%, outperforming the average gain of 18.2% for Basic Materials stocks [4] - Nexa is part of the Mining - Miscellaneous industry, which includes 73 companies and currently ranks 50 in the Zacks Industry Rank, with the industry average gain at 21.8% this year, indicating NEXA's superior performance [6] - Denison Mine (DNN) is another stock in the Basic Materials sector that has shown strong performance, returning 45.9% year-to-date and holding a Zacks Rank of 2 (Buy) [5]

Core Insights - Nexa Resources S.A. reported strong financial performance in Q4 2025, with net revenues of $903 million and adjusted EBITDA of $300 million, reflecting improvements in operational execution and favorable pricing for zinc and by-products [15][5][1] - Zinc production reached 91,000 tons in Q4 2025, marking a 9% increase from the previous quarter, driven by enhanced performance across operations, particularly at Aripuanã [6][2] - The company achieved full-year net revenues of $3 billion and adjusted EBITDA of $772 million, indicating a solid operational execution and a favorable pricing environment [5][15] Financial Performance - Q4 2025 net revenues increased by 18% sequentially and 22% year-over-year, driven by higher metal prices and improved mining performance [15] - Full-year adjusted EBITDA reached $772 million, an 8% increase compared to 2024, with a margin of 26% [16] - Free cash flow for the year was negative $105 million, influenced by debt reductions and dividends [21] Mining Operations - The mining segment generated net revenues of $532 million and adjusted EBITDA of $266 million in Q4 2025, resulting in a 50% EBITDA margin [8] - Full-year zinc production totaled 316,000 tons, meeting production guidance, while total metal sales reached 567,000 tons [5][12] - Cash costs improved to negative $0.58 per pound in Q4, benefiting from stronger by-product grades and lower treatment charges [7] Smelting Performance - Smelting segment sales were 142,000 tons for Q4 and 567,000 tons for the full year, in line with guidance [12] - Q4 cash cost was $1.41 per pound, reflecting higher zinc prices and lower treatment charges [13] - Full-year net revenues for the smelting segment totaled approximately $2 billion, with adjusted EBITDA of $113 million [14] Strategic Projects - The Cerro Pasco Integration Project aims for a life-of-mine extension of over 15 years, enhancing profitability and operational flexibility [10][33] - The fourth tailings filter at Aripuanã is on track for commissioning in the first half of 2026, expected to unlock full operational capacity [9][32] - Exploration activities confirmed new mineralized extensions across key assets, reinforcing the potential for further life-of-mine extensions [11][12] Market Outlook - Zinc prices remained supported throughout 2025 due to tight concentrate supply and low LME inventories, with expectations for a gradual improvement in mining supply in 2026 [24][26] - The silver streaming agreement will step down from 65% to 25% in Q2 2026, increasing Nexa's realized exposure to silver prices [28] - Copper prices appreciated in 2025, driven by supply discipline and sustained demand, with medium-term supply constraints expected to support prices [27] ESG Initiatives - The company advanced its ESG strategy, focusing on renewable energy supply, waste reduction, and community engagement [30] - A structured review of public ESG targets was conducted to enhance transparency and ensure alignment with operational realities [31] - Nexa Resources aims to maintain a strong governance framework and improve methodological consistency in its sustainability commitments [35]

Financial Data and Key Metrics Changes - In Q4 2025, the company reported net revenues of $903 million, an 18% increase sequentially and a 22% increase year-over-year, driven by higher average metal prices and improved mining performance [16][5] - Adjusted EBITDA for Q4 reached $300 million, reflecting a 33% margin, with full-year adjusted EBITDA totaling $772 million, an 8% increase compared to 2024 [16][17] - Net income for the year was $223 million, or $1 per share, while free cash flow was negative $105 million due to debt reductions and dividends [7][20] Business Line Data and Key Metrics Changes - Zinc production in Q4 was 91,000 tons, a 9% increase from Q3, with full-year production totaling 316,000 tons, meeting guidance [8][6] - The mining segment generated net revenues of $532 million in Q4, with adjusted EBITDA of $266 million, resulting in a 50% EBITDA margin [9] - In the smelting segment, total metal sales were 142,000 tons for Q4 and 567,000 tons for the full year, with net revenues of $573 million in Q4 and $2 billion for the full year [13][14] Market Data and Key Metrics Changes - Zinc prices remained well-supported throughout 2025 due to persistent concentrate tightness and low LME inventories, with treatment charges in China averaging negative levels [23] - Copper prices appreciated in 2025 driven by supply discipline and sustained demand, particularly from electrification [24] Company Strategy and Development Direction - The company is focused on enhancing operational stability and cash generation, particularly through the Aripuanã project, which is expected to reach full capacity in 2026 [10][29] - The Cerro Pasco Integration Project aims for a life-of-mine extension of over 15 years, enhancing profitability and solidifying the company's presence in Peru [11][29] - The company is actively evaluating value-accretive opportunities, particularly in copper, as it aims to strengthen its balance sheet and reduce debt [29][63] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operational stability and cash flow generation for 2026, despite potential challenges from the rainy season and political uncertainties in Peru [35][57] - The company remains committed to reducing gross debt and enhancing financial flexibility while maintaining a strong investment-grade rating [22][30] Other Important Information - The company reported a net debt reduction of $96 million, reflecting its liability management efforts [20] - The liquidity position remains robust, with total liquidity of $842 million, supporting financial commitments over the next five years [22] Q&A Session Summary Question: Impact of seasonal rains on Aripuanã production - Management indicated that the rainy season has not significantly impacted production, with expectations to reach full capacity in the second half of the year due to the installation of the fourth filter [34][35] Question: Consideration of additional silver streaming - Management confirmed that while they are aware of the interest in silver, they are not currently prioritizing additional silver streaming agreements [41][43] Question: Cash flow impact of Cerro Lindo silver stream - Management noted that the silver streaming agreement will step down from 65% to 25%, which will positively impact cash flow [46][47] Question: Update on Ayawilca project and Tinka Resources investment - Management stated that they are assessing the Ayawilca project following the disapproval of the environmental impact study and have decided not to pursue further investment in Tinka Resources at this time [54][55] Question: Current electoral environment in Peru - Management acknowledged the political instability but emphasized that the economic context remains strong and that relationships with local communities are stable [57][59] Question: Debt repayment plans for 2026 and 2027 - Management indicated that any excess cash generated will be used for dividends and debt repayment, with a focus on reducing debt [60][62] Question: Details on hedging program for silver and gold - Management confirmed a small portion of silver production has been hedged, with a floor around $52 and a cap around $84 [60] Question: CapEx for Cerro Pasco project - Management confirmed that CapEx for the Cerro Pasco project is on track, with expectations to spend around $42 million this year [68]

Financial Data and Key Metrics Changes - In Q4 2025, the company reported net revenues of $903 million, an 18% increase sequentially and a 22% increase year-over-year [16] - Adjusted EBITDA for Q4 was $300 million, reflecting a 33% EBITDA margin, with a full-year adjusted EBITDA of $772 million, an 8% increase compared to 2024 [16][17] - The company recorded a net income of $81 million or $0.38 per share for Q4, and a full-year net income of $223 million or $1 per share [5][7] - Free cash flow for the full year was negative $105 million, impacted by debt reductions and dividends [20] Business Line Data and Key Metrics Changes - Zinc production in Q4 reached 91,000 tons, a 9% increase from Q3, with full-year production totaling 316,000 tons, meeting guidance [4][6][8] - The mining segment generated net revenues of $532 million and adjusted EBITDA of $266 million in Q4, resulting in a 50% EBITDA margin [9] - In the smelting segment, total metal sales were 142,000 tons for Q4 and 567,000 tons for the full year, with net revenues of $573 million and adjusted EBITDA of $34 million in Q4 [13][14] Market Data and Key Metrics Changes - Zinc prices remained well-supported throughout 2025 due to persistent concentrate tightness and low LME inventories [23] - Treatment charges in China averaged negative levels during the year, reflecting raw material scarcity [23] - Copper prices appreciated in 2025 driven by supply discipline and sustained demand, particularly from electrification [24] Company Strategy and Development Direction - The company is focused on operational stability and disciplined capital allocation, with key projects like Aripuanã and Cerro Pasco Integration Project being central to long-term value creation [29] - The company aims to generate sustainable cash flow to strengthen its balance sheet and support a balanced capital allocation approach, including deleveraging and shareholder returns [30] - The company is actively looking for opportunities in the copper market, with a focus on maintaining a solid financial position [62] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operational stability and cash generation potential of Aripuanã, especially with the upcoming commissioning of the fourth filter [10][29] - The company remains committed to reducing gross debt and enhancing financial flexibility, with a target of lowering interest expenses over time [22] - Management acknowledged the political environment in Peru but emphasized the strong economic context and good relationships with local communities [56][58] Other Important Information - The company maintained a robust liquidity position with total liquidity of $842 million, including an undrawn $320 million revolving credit facility [22] - The average debt maturity increased to 7.6 years, reflecting proactive liability management [22] - The company is advancing its ESG strategy, focusing on climate action, community engagement, and governance improvements [27] Q&A Session Summary Question: Impact of seasonal rains on Aripuanã production - Management confirmed that the rainy season has not significantly impacted production, with expectations to reach full capacity in the second half of the year [34][35] Question: Consideration of additional silver streaming - Management stated that while they are aware of the interest in silver, they are not currently considering additional silver streaming as a priority [41][43] Question: Cash flow impact of Cerro Lindo silver stream - Management explained that the silver streaming agreement will step down from 65% to 25%, which will positively impact cash flow [46] Question: Update on Ayawilca project and Tinka Resources investment - Management indicated that they are assessing the Ayawilca project following the disapproval of the environmental impact study and have decided not to pursue further investment in Tinka Resources [54] Question: Debt repayment plans for 2026 and 2027 - Management confirmed that debt repayment remains a priority, with plans to use excess cash for debt reduction [59] Question: Details on hedging program for silver and gold - Management provided details on the hedging program, with a floor around $52 and a cap around $84 for silver [60] Question: CapEx for Cerro Pasco integration project - Management confirmed that CapEx for the Cerro Pasco project is on track, with expectations to spend around $42 million this year [68]