Value
8.4/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 9.3 |
| P/S | 10.0 |
| EV/EBITDA | 9.2 |
| Fwd P/E | 10.0 |
| PEG | 10.0 |
| Analyst target | 3.0 |
- ▸Forward P/E: 4.6x
- ▸PEG: 0.01
- ▸Attractively valued
NEXA · Why this verdict
Why Nexa Resources (NEXA) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score6.5/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The current stock price already exceeds analyst consensus targets by approximately 26%, meaning the risk/reward is structurally negative at current entry levels with no margin of safety for new buyers. Warnings | Analyst consensus price target increases above $17 within 12 months, restoring at least 10% upside from current levels. | →Stable |
| CounterThe stock's technical setup shows range-bound momentum with rising volume accumulation, suggesting institutional buyers may be building positions ahead of a potential analyst target revision. | ||
Nexa trades at a forward P/E of only 5.5x with a PEG of 0.01 and free cash flow conversion of 121% relative to net income, placing it among the most attractively valued names in its industrial metals peer group. Valuation breakdown | The discount to intrinsic value narrows as free cash flow generation leads to improved analyst price targets above $16 over the next 12 months. | →Stable |
| CounterMetals mining valuations are tightly linked to commodity prices; a sustained decline in zinc or copper prices could rapidly erode the apparent earnings power underpinning the low P/E. | ||
Revenue grew 42% year-over-year with volume accumulation visible in rising on-balance volume, and the company's return on equity and cash conversion both rank favorably relative to industrial metals peers. Growth breakdown | Revenue growth sustains above 20% year-over-year for the next 2 quarters as metals demand remains resilient. | →Stable |
| CounterRevenue growth driven primarily by commodity price increases rather than volume expansion is inherently cyclical and can reverse quickly with price normalization. | ||
Nexa has missed earnings estimates in 3 of the last 4 quarters with an average negative surprise of -57%, indicating a persistent inability to meet analyst expectations despite strong top-line growth. Bear case | The company returns to meeting or exceeding consensus EPS estimates in at least 2 of the next 3 quarters. | →Stable |
| CounterThe most recent quarter showed an inline result after prior deep misses, which may indicate the earnings miss cycle has bottomed and expectations have been sufficiently reset. | ||
The current stock price already exceeds analyst consensus targets by approximately 26%, meaning the risk/reward is structurally negative at current entry levels with no margin of safety for new buyers.
→StableWarnings
- Expectation
- Analyst consensus price target increases above $17 within 12 months, restoring at least 10% upside from current levels.
CounterThe stock's technical setup shows range-bound momentum with rising volume accumulation, suggesting institutional buyers may be building positions ahead of a potential analyst target revision.
Nexa trades at a forward P/E of only 5.5x with a PEG of 0.01 and free cash flow conversion of 121% relative to net income, placing it among the most attractively valued names in its industrial metals peer group.
→StableValuation breakdown
- Expectation
- The discount to intrinsic value narrows as free cash flow generation leads to improved analyst price targets above $16 over the next 12 months.
CounterMetals mining valuations are tightly linked to commodity prices; a sustained decline in zinc or copper prices could rapidly erode the apparent earnings power underpinning the low P/E.
Revenue grew 42% year-over-year with volume accumulation visible in rising on-balance volume, and the company's return on equity and cash conversion both rank favorably relative to industrial metals peers.
→StableGrowth breakdown
- Expectation
- Revenue growth sustains above 20% year-over-year for the next 2 quarters as metals demand remains resilient.
CounterRevenue growth driven primarily by commodity price increases rather than volume expansion is inherently cyclical and can reverse quickly with price normalization.
Nexa has missed earnings estimates in 3 of the last 4 quarters with an average negative surprise of -57%, indicating a persistent inability to meet analyst expectations despite strong top-line growth.
→StableBear case
- Expectation
- The company returns to meeting or exceeding consensus EPS estimates in at least 2 of the next 3 quarters.
CounterThe most recent quarter showed an inline result after prior deep misses, which may indicate the earnings miss cycle has bottomed and expectations have been sufficiently reset.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Nexa Resources is a metals and mining company with extremely attractive valuation metrics and 42% revenue growth, but three consecutive earnings misses and a current price already exceeding analyst consensus targets make it a high-risk hold rather than a compelling entry.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 8.1 |
| ROA | 4.8 |
| Gross margin | 1.2 |
| Op margin | 9.6 |
| Net margin | 3.2 |
| Current ratio | 3.4 |
| FCF quality | 9.0 |
| Moat | 6.0 |
| Piotroski F | 6.7 |
- ▸Excellent cash conversion: 121% FCF/NI
Growth
10.0/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
- ▸Strong growth: 42% YoY
Momentum
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 1.8 |
| OBV | 10.0 |
| MA position | 4.0 |
| Volume | 9.0 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 6.2 |
| Analyst rating | 5.0 |
| Price target | 4.2 |
Insider
5.0/10data confidence 50%Peer rank
5.3/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 8.4 |
| quality rank | 7.3 |
| growth rank | 5.6 |
- ▸Attractive P/E vs peers
- ▸Superior ROE vs peers
Technical
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 5.5 |
| support resistance | 6.3 |
| 52w position | 5.4 |
| gap | 3.0 |
- ▸Extreme gap up (12.0%) - may pull back
Risk (lower is worse)
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 9.7 |
| days to cover | 10.0 |
| volatility | 0.0 |
| put call | 4.6 |
| implied vol | 0.0 |
| beta | 7.5 |
| debt equity | 4.4 |
- ▸High IV: 89%
Catalyst
3.9/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 0.0 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
| dividend safety | 5.2 |
| news activity | 8.0 |
- ▸Earnings concerns: 0B/3M
- ▸Dividend: 118.0%
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLDPassed (6)
- MOMENTUM:6.1>=5.5
- INSIDER:OK
- 8K:CLEAN
- EARNINGS_PROXIMITY:26d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-1.2=NEGATIVE
Warning (0)
none
Reward-to-Risk
-1.22
Upside
-17.9%
Downside
14.6%
Sizing output
AVOID
SetupRange Bound — RSI 51 mid-range, Bollinger mid-band
EdgeInst Constrain — Small cap ($1.7B) below institutional reach
SuitabilityAggressive — MCap $1.7B<$5B
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: MOMENTUM:6.1>=5.5. Top dim: Growth at 10.0; weakest: Catalyst at 3.9. No conviction either direction.
The strongest dimensions are Growth at 10.0, Value at 8.4, and Momentum at 6.1; the weakest are Catalyst at 3.9, Technical at 5.0, and Insider at 5.0. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of -1.22 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Deep Value Metrics
Trip ifFree cash flow conversion falls below 80% of net income or forward P/E rises above 10x due to earnings contraction.
- P2Strong Revenue Growth
Trip ifRevenue growth falls below 10% year-over-year for 2 consecutive quarters.
- P3Consecutive Earnings Misses
Trip ifEPS surprise falls below -20% in at least 2 of the next 3 quarters.
- P4Price Above Analyst Target
Trip ifPrice drops below $13.40 stop-loss level or analyst consensus target declines below $12.