MeritValue

Ero Copper Corp.

EROdata completeness 88%6 fiscal years on file
The thesis, from the filings

Ero Copper Corp. earns about 22% on invested capital, but has diluted owners by 16% over 5 years — worth asking whether the growth reaches owners. The applicable estimate puts fair value near $10.13 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$489.9M1$426.4M2$427.5M3$470.3M4$785.8M4
Net income$201.1M5$101.8M6$92.8M7−$68.5M8$263.7M8
Operating cash flow$364.6M9$143.4M10$163.1M11$145.4M12$395.1M12
Capital expenditure$169.2M13$282.8M14$447.2M15$329M16$262.8M16
Free cash flow (derived)$195.4M9−$139.4M10−$284.1M11−$183.5M12$132.4M12
Total debt$59.3M17$418.1M17$426.2M17——
Cash & equivalents$130.1M18$177.7M19$111.7M20$50.4M20$105.4M20
Diluted shares90.2M92.2M102.7M103.6M104.2M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$89.79
your share of equity
Profit it earned you last year
$25.31
Free cash flow it threw off
$12.71
Debt you’d be carrying
—

10 shares is a claim on $89.79 of net worth that earned you $25.31 and generated $12.71 of cash last year.

iii. Is this a good business?
Moat signal · return on invested capital
22% avg · 5y
FY21 64%FY22 16%FY23 11%FY24 -11%FY25 32%

It earned an average 22% on invested capital over 5 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
+16% shares · 5y

Share count is up 16% over 5 years — owners have been diluted. Worth asking what they got for it. Total debt has risen 619% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0
DCF · Growth Exit 10Y
not applicable
3y-median FCF non-positive — growth-exit DCF not applicable (see EPV)
DCF · Growth Exit 5Y
not applicable
3y-median FCF non-positive — growth-exit DCF not applicable (see EPV)
Earnings Power Value
$10.13
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$101.8M
  • growthAssumed0.0%
Graham Number
$22.61
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 40-F · period ending 2021-12-31 · accession 0001628280-23-006809 (RevenueFromContractsWithCustomers)
  2. 40-F · period ending 2022-12-31 · accession 0001628280-24-009701 (RevenueFromContractsWithCustomers)
  3. 40-F · period ending 2023-12-31 · accession 0001628280-25-010994 (RevenueFromContractsWithCustomers)
  4. 40-F · period ending 2024-12-31 · accession 0001628280-26-022073 (RevenueFromContractsWithCustomers)
  5. 40-F · period ending 2021-12-31 · accession 0001628280-23-006809 (ProfitLossAttributableToOwnersOfParent)
  6. 40-F · period ending 2022-12-31 · accession 0001628280-24-009701 (ProfitLossAttributableToOwnersOfParent)
  7. 40-F · period ending 2023-12-31 · accession 0001628280-25-010994 (ProfitLossAttributableToOwnersOfParent)
  8. 40-F · period ending 2024-12-31 · accession 0001628280-26-022073 (ProfitLossAttributableToOwnersOfParent)
  9. 40-F · period ending 2021-12-31 · accession 0001628280-23-006809 (CashFlowsFromUsedInOperatingActivities)
  10. 40-F · period ending 2022-12-31 · accession 0001628280-24-009701 (CashFlowsFromUsedInOperatingActivities)
  11. 40-F · period ending 2023-12-31 · accession 0001628280-25-010994 (CashFlowsFromUsedInOperatingActivities)
  12. 40-F · period ending 2024-12-31 · accession 0001628280-26-022073 (CashFlowsFromUsedInOperatingActivities)
  13. 40-F · period ending 2021-12-31 · accession 0001628280-23-006809 (PurchaseOfPropertyPlantAndEquipmentClassifiedAsInvestingActivities)
  14. 40-F · period ending 2022-12-31 · accession 0001628280-24-009701 (PurchaseOfPropertyPlantAndEquipmentClassifiedAsInvestingActivities)
  15. 40-F · period ending 2023-12-31 · accession 0001628280-25-010994 (PurchaseOfPropertyPlantAndEquipmentClassifiedAsInvestingActivities)
  16. 40-F · period ending 2024-12-31 · accession 0001628280-26-022073 (PurchaseOfPropertyPlantAndEquipmentClassifiedAsInvestingActivities)
  17. 40-F · period ending 2021-12-31 · accession 0001628280-24-009701 (Borrowings)
  18. 40-F · period ending 2021-12-31 · accession 0001628280-24-009701 (CashAndCashEquivalents)
  19. 40-F · period ending 2022-12-31 · accession 0001628280-25-010994 (CashAndCashEquivalents)
  20. 40-F · period ending 2023-12-31 · accession 0001628280-26-022073 (CashAndCashEquivalents)