Westgold Resources (WGX) - Gold in the west
October 8, 2024
Westgold Resources is a gold explorer and producer whose assets are primarily in Western Australia. The company’s projects include the Bryah, Murchison, Meekatharra and Cue operations that comprise various mining titles covering 1,300 square kilometres in the Murchison region. Westgold Resources was incorporated in 1987 and is based in Perth, Australia.
Westgold recently merged with Karora Resources and is now expected to produce circa 410,000 ounces of gold in FY25. We see production increasing to more than 480, 000 ounces per annum by FY26 for at least four years, along with decent free cash – we estimate around $210 million per annum on average.
We also see upside risk given the growth outlook and the exploration appeal from the Fletcher Zone (Beta Hunt) prospect, but we balance this slightly against potential near-term negative surprises as the merger is bedded down in the first half of FY25.
We initiate coverage on Westgold with an Accumulate Recommendation and $3.10 price target.
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