A mixed bag from IGO during the December quarter according to Credit Suisse, with the Nova project performing well on both production and costs, while Greenbushes was low on production and high on costs. Higher than expected realised pricing drove an earnings beat.
Despite decreasing earnings expectations given expected lower realised pricing and higher costs, the broker remains positive that IGO can capitalise on strong lithium demand in the medium term and expects peak pricing in FY23 as the company ramps up production.
The Outperform rating is retained and the target price decreases to $15.30 from $16.30.
Sector: Materials.
Target price is $15.30.Current Price is $11.85. Difference: $3.45 – (brackets indicate current price is over target). If IGO meets the Credit Suisse target it will return approximately 23% (excluding dividends, fees and charges – negative figures indicate an expected loss).
