WGX westgold resources limited.

1.35%

$2.93

"I won’t be surprised to see POG get to $US2,500"I suggest more...

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deserthead

1,382 Posts.

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01/04/24

11:21

Post #: 73134070
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Originally posted by calmbeforestorm: ↑

Given the current market expectations of a higher POG and the speed at which it has increased the following maybe a plausible scenario. Note there are a lot of IF’s in the scenario and the key if is for the POG to remain at current levels or higher.

In the 12 months to December 2023 WGX realised POG was $2,820 which is an amazing $600 below the current spot POG. ASIC during this period was $2,011.

Looking forward, which is what the stock market does if WGX achieves the mid-point of ASIC guidance of $1,900 and the POG remains at the current spot price then WGX with production of 250,000 Oz will see profit increase by $122.5m after tax ($175m before tax). The net profit after tax for the 12 months to December 2023 was about $80m and that would increase to $202.5m in the next 12 months an increase of 153%.

At the current market cap that profit is a forward PE of 6.1. If WGX re-rated to a forward PE of 10, which is an undemanding PE, the SP would be about $4.30. And if it re-rates to a forward PE of 15 the SP may be about $6.40 nearly 2.5 times the current SP.

If all the expert forecasts are correct for the POG this year of between $US2,200 and $US2,300 (some are higher but let’s ignore those) then WGX and almost all gold producers are in for a serious re-rating in the rest of 2024 and into 2025. And if POG, goes above $US2,300 then WGX SP could double along with all other gold producers. I won’t be surprised to see POG get to $US2,500 later this year but we do not need to see POG go that high for WGX and all other gold producers to be substantially re-rated.

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"I won’t be surprised to see POG get to $US2,500"

I suggest more like the end of this month. Go back and study 50 years of gold price behaviour on breaks in price following multi year tops.
- 45 Breaks to new ATH's
- 49% of advances were >100% ( and we are not talking years, but in many cases less than 12 months)
- one was 347%
- one was 335%

WGX Price at posting: $2.62 Sentiment: Buy Disclosure: Held
2 Upvote

0 Great analysis

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(20min delay)
Last $2.93		Change -0.040(1.35%)		Mkt cap ! $2.763B

Open	High	Low	Value	Volume
$2.94	$2.98	$2.93	$33.24M	11.34M

Buyers (Bids)

No.	Vol.	Price($)
7	663107	$2.93

Sellers (Offers)

Price($)	Vol.	No.
$2.94	369285	3

View Market Depth

No.	Vol.	Price($)
7	663107	2.930
15	758324	2.920
7	164579	2.910
7	87258	2.900
5	161098	2.890

Price($)	Vol.	No.
2.940	369285	3
2.950	20105	4
2.960	125590	3
2.970	72664	4
2.980	29432	3

Last trade - 16.10pm 20/06/2025 (20 minute delay)

WGX (ASX) Chart

"I won’t be surprised to see POG get to $US2,500"I suggest more...

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