Galaxy Resources has provided an updated development plan for Sal de Vida as well as preliminary production at Mount Cattlin.
In terms of Sal de Vida the plan has delivered production rates that are 28% higher than expected, underpinning Macquarie’s recent upgrade to Outperform. This comes with a slower ramping up but no additional capital costs.
The broker upgrades its expectations for Sal de Vida to match the plan and raises the target to $4.50 from $4.20. Meanwhile, earnings at Mount Cattlin are improving, buoyed by rising spodumene prices.
Target price is $4.50.Current Price is $3.53. Difference: $0.97 – (brackets indicate current price is over target). If GXY meets the Macquarie target it will return approximately 22% (excluding dividends, fees and charges – negative figures indicate an expected loss).