TSX:NGD - Post Discussion
Post by
TELEMARKER on May 22, 2024 12:55pm
stockwatch.com
Globe says Parkin boosts New Gold to "outperform"
2024-05-22 08:24 ET - In the News
The Globe and Mail reports in its Wednesday edition that National Bank Financial analyst Mike Parkin has upgraded his recommendation for New Gold to "outperform" from "sector perform" in response to its strategic partnership with Ontario Teachers' Pension Plan at the New Afton mine that will increase its effective free cash flow interest to 80.1 per cent (from 54 per cent) for an upfront cash payment of $255-million (U.S.) (all subsequent figures Canadian). Mr. Parkin gave his share target a 25-cent boost to $3.50. Analysts on average target the shares at $2.70. Mr. Parkin says in a note: "Our 2H24+ gold and copper production estimates move meaningfully higher with the 100-per-cent ownership of New Afton, while costs over the same period decline. We have also tweaked our resource credits at New Afton modestly higher to better align with our DCF/GEO value and long-term gold and copper prices. We believe the increased resource credits are fair given the LOM upside potential over the next few years as further exploration continues on near-mine exploration targets, as well as the good start to the C Zone ramp up. ... As a result of our model updates, we see our NAVPS increase 17 per cent while our target price rises."
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