The company announced a $100m capital raising ($85m placement/$15m SPP) at a minimum price of $2.15. This implies to Morgans more risk remaining to production volumes at Forrestania than forecast and the analyst reduces expected production and revenue.
This raising exceeds Morgans expectation of $50m and at a weaker price than forecast. The funds will be used in construction at Cosmos/Odysseus ($70m) and $30m to exploration and organic growth.
The broker lowers the rating to Hold from Add and decreases the target to $2.57 from $2.91.
Sector: Materials.
Target price is $2.57.Current Price is $2.36. Difference: $0.21 – (brackets indicate current price is over target). If WSA meets the Morgans target it will return approximately 8% (excluding dividends, fees and charges – negative figures indicate an expected loss).
