Macquarie has just updated CXO back to outperform. Maintains $1.30 PT but lists upcoming catalysts as "Completion of the first DSO shipment and confirmation of progress of the spodumene concentrate plant construction present key near-term catalysts for CXO."
Given first DSO shipment is due any week now, there may be a Macquarie PT upgrade on the horizon too.
Macquarie recommendations
"Upgrading from Neutral to Outperform: We believe the regional explorationpotential of the Finniss project is strong and will become more recognised once spodumene production commences in 2023. Our development scenario for Finniss is based on a mining inventory equivalent to two thirds of current resources. Upgrades to the resource base are likely in our view to capture the recent drilling results. CXO’s share price is down 43% over the past month, significantly outpacing the 9% fall in spot China lithium carbonate prices over the same period (ASX200 <1% move). We expect CXO to generate strong cash flow once spodumene production commences, with the stock trading on FY24 and FY25 free cash flow yields of 14% and 37%, respectively"
I wonder if it's time for the BEOT to start pumping SP & cover shorts? The timeline seems consistent with the mid-year fiasco too.
As always, DYOR.
Last edited by Spectreau:
Corrected formatting19/12/22
CXO Price at posting:
$1.06 Sentiment: Hold Disclosure: Held
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