September quarter production was solid and in line with budget, Credit Suisse observes. FY21 forecasts for 370-410,000 ounces are unchanged.
However, the broker was disappointed with the performance at Gwalia, albeit this is insignificant in the context of the long-term opportunity.
The main catalyst for the short term is a strategy update in late November/early December to define Gwalia’s optimisation and life-of-mine plan. Outperform rating and $4.40 target retained.
Target price is $4.40.Current Price is $2.92. Difference: $1.48 – (brackets indicate current price is over target). If SBM meets the Credit Suisse target it will return approximately 34% (excluding dividends, fees and charges – negative figures indicate an expected loss).