Newcrest Mining will move to the second stage at the Cadia expansion project. This US$175m expansion should be completed in late FY22.
The miner will also spend US$65m at Lihir to pick up more gold. Citi believes consensus expectations at Lihir have been reset and earnings momentum is now positive.
Newcrest Mining will also list on the Toronto Stock Exchange this week but, as there is no equity issue with this secondary listing, liquidity could be challenging, Citi asserts, noting the TSX is “crowded with gold stocks”.
Citi upgrades to Buy from Neutral and maintains a $37 target.
Sector: Materials.
Target price is $37.00.Current Price is $31.26. Difference: $5.74 – (brackets indicate current price is over target). If NCM meets the Citi target it will return approximately 16% (excluding dividends, fees and charges – negative figures indicate an expected loss).
