• Nexa Resources has reported that operations at its Cajamarquilla zinc smelter in Peru, disrupted by a fire in mid-May 2026, are now gradually resuming, with electrolysis lines fully operational, one casting line already producing zinc bars, and the remaining lines expected back online by mid-June after an estimated Second Quarter 2026 production shortfall of about 7 kt of refined zinc.
• An important takeaway for investors is that Nexa expects this production shortfall, roughly 2% of its annual refined zinc output, to be recovered during the second half of 2026 while keeping its full-year sales guidance unchanged, suggesting the incident is being treated as a temporary operational setback rather than a long-term capacity issue.
• Next, we’ll examine how the expected recovery of lost Cajamarquilla zinc output in late 2026 affects Nexa Resources’ investment narrative.

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Nexa Resources Investment Narrative Recap

To own Nexa Resources today, you need to believe in its integrated zinc mining and smelting model and in management’s ability to keep operations stable while carrying meaningful debt. The Cajamarquilla fire looks like a manageable, short term disruption, with Nexa keeping full year zinc sales guidance unchanged, so it does not materially alter the near term focus on Aripuana’s ramp up as the key catalyst and execution and cost control as a central risk.

The most relevant recent update here is Nexa’s strong Q1 2026 earnings, with sales of US$888.32 million and net income of US$89.31 million. This performance, together with reaffirmed 2026–2028 production and sales guidance, provides the backdrop for judging Cajamarquilla’s outage as a temporary setback and for assessing how quickly Nexa can translate its project pipeline and smelting improvements into sustained cash generation.

Yet, while Cajamarquilla’s impact appears contained, investors should still pay close attention to how future operational incidents could interact with Nexa’s high debt load and...

Nexa Resources' narrative projects $2.9 billion revenue and $150.5 million earnings by 2029. This assumes largely flat yearly revenue and an earnings increase of about $166.7 million from -$16.2 million today.

Uncover how Nexa Resources' forecasts yield a $7.02 fair value, a 56% downside to its current price.

Exploring Other Perspectives

Some of the lowest ranked analysts were already cautious, assuming revenue of about US$3.0 billion and earnings near US$158.8 million by 2029, so this Cajamarquilla incident could either reinforce their concerns about smelter margin pressure or prompt a rethink if Nexa’s recovery is smoother than expected.

Explore 4 other fair value estimates on Nexa Resources - why the stock might be worth as much as $15.00!

Form Your Own Verdict

Don't just follow the ticker - dig into the data and build a conviction that's truly your own.

• A great starting point for your Nexa Resources research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.
• Our free Nexa Resources research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Nexa Resources' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.