UBS cuts PT on Australian gold stocks on inflationary headwinds

De Grey Mining

05/08/2022 02:27

** UBS trims PT on Australian gold players across the deck
on tempered growth ambitions and operating and inflation
headwinds 
    ** Says gold stocks not as cheap as they look and remains
cautious heading into results season
    ** Adds that the industry is facing operating headwinds from
aging mines, lower grades, labour and inflation reducing
earnings and cash margins
    ** Most gold stocks met their reduced guidance in the June
quarter but cut their FY23 production forecast and flagged
increasing costs
    ** Gold producer Northern Star Resources  NST.AX  remains
top pick among large caps, while Gold Road Resources  GOR.AX  is
preferred in small caps firms - UBS
    ** UBS sees gold poised to trade higher, against a backdrop
of rising recession risks and Fed's policy tightening
    ** Gold sub-index  .AXGD  down 18.8%, outpacing declines in
the ASX 200 benchmark index  .AXJO , which is down 6.3%

 Company                  Ric     New PT  Old PT
 Northern Star Resources  NST.AX  9.8     10
 Newcrest Mining          NCM.AX  19.7    20.3
 Evolution Mining         EVN.AX  2.8     2.9
 Gold Road Resources      GOR.AX  1.8     1.85
 De Grey Mining           DEG.AX  1.1     1.15
 
 (Reporting by Savyata Mishra in Bengaluru)
 ((Savyata.mishra@thomsonreuters.com))