Edison increases its valuation of Pan African despite lower production forecast
Analyst Edison Investment Research has increased its valuation of South African gold miner Pan African Resources to $0.48 a share, from $0.41 previously.
London- and Johannesburg-listed Pan African earlier this month announced that it had revised its 2024 full-year production guidance to between 186 000 oz and 190 000 oz, compared with previous guidance of 180 000 oz to 190 000 oz, owing to it having ceased the processing of marginal surface sources at Evander Gold Mines.
It, nevertheless, remained confident of achieving an "excellent" financial performance on the back of still robust production and record rand gold prices.
The miner also set its production guidance for 2025 at between 215 000 oz and 225 000 oz.
Edison says it continues to forecast that Pan African's production will reach about 250 000 oz/y in 2026 and that the gold miner's normalised headline earnings a share will increase beyond $0.06 a share and, potentially, reach as high as $0.09 a share.
It states that Pan African's current share price of 26.7p appears to be discounting the normalised headline earnings a share for the 2024 and 2025 financial years.
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