Bell Potter has cut its price target on Metals X slightly but retained its 'buy' rating on the stock, saying it still saw potential in the company's assets.The broker lowered its price target from 16¢ to 15¢, still 55 per cent above the company's 9.7¢ closing price on Friday.Metals X plans to release an updated resource for Nifty which is currently on care and maintenance, as it carries out a strategic review of its copper business.
"The strategic review is exploring all options for the copper assets but we think it unlikely Metals X will get a fair offer for any of them and that it should retain them," said analyst Peter Arden.He was also forecasting improved performance from the miner with tin mining in new high grade areas set to begin in the first half of the 2021 financial year.The broker said the company should look through the short term and exploit more value from its assets rather than sell them.
"Metals X’s inability to achieve forecast outcomes in the past few years has brought discredit on itself but we believe its three assets have greater value than is currently recognised," said Mr Arden."Metals X is unlikely to get a fair price for any part of its copper business in the current environment with concerns over coronavirus and lower global growth and we think it should retain its copper assets and restart Nifty on an appropriate basis in 2021 when copper prices are more likely to reflect the underlying supply shortages."
MLX Price at posting:
9.4¢ Sentiment: Hold Disclosure: Held
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