This is #3 in our "Twelve Stocks of Christmas 2025" Series. You can review the full set here.
The Pitch
Serabi Gold (LON:SRB) is an AIM-listed gold miner operating in Brazil which has ten-bagged from lows in 2023. It has strong operational momentum with production up, gold grades improving and cash balance growing. With a StockRank of 99, Serabi is high-margin small cap riding the gold price tailwind, surging free cash flow and an exploration push for a 2 million ounce (2Moz) resource. A low valuation and broker upgrades support further price appreciation in 2026.
The Big Picture
Serabi operates two high-grade underground mines - Palito and Coringa - in the Tapajos region of northern Brazil. It's an underdeveloped but very prospective region, until recently dominated by artisanal mining. After a decade dealing with operational setbacks and funding issues, Serabi now stands as the only serious hard rock producer in the region.
- Why now? The company is hitting record production. Year to date output hit 32.6koz, which was a 19% year-on-year rise. It's on track for 44koz+ for the full year, with further growth forecast up to 57koz in FY26.
- Grades improving - plant feed grades jumped 30% in 2025 from 5.4 grams per tonne to nearly 7.0 g/t - which speaks to the efficiency improvements.
- Coringa ramping up - Two new zones are coming online, which would put 60koz production within reach in the future.
Going deeper
Serabi is a high-grade underground mining company which operates at lower tonnage. It trucks ore from Coringa to a central plant at Palito which can unlock growth without too much additional capex.
- Cash generation - Q3 saw net cash inflow hit more than $34M, with year end cash expected at $45M - that’s 15% of its market cap.
- Ore Sorter success - Coringa's ore sorter is now handling higher-grade run of mine ore, which increases gold production and lowers haulage costs by removing waste rock.
- Exploration upside – recent drilling hit "spectacular" grades at Palito Senna Zone. This supports Serabi’s goal of nearly doubling the resource base to 2Moz.
- Undemanding valuation - In spite of a 160% share price rally in 2025, and forecast EPS growth of almost 60% -the P/E remains low, below 4x forecast estimates.
What the brokers say
Serabi is covered…
