GOR price target - $1.05 to $1.68 by end 2019

DYOR. Not Advice.
Targets presented below are based on my research and calculations. You are encouraged to DYOR and make your own decisions.​

Updating my price targets (first posted here).

Gold Road Resources are planning to achieve first gold pour in Q2 ( and they say they are on track for this ).

They indicate (see video below) nameplate by the end of 2019 (by my calculations at current gold price AUD $1813 ... GOR's 50% share of the project would be capable of generating revenue $62M per quarter once they reach nameplate ). Exchange rate 0.718 used.

I've got 3 price targets based on various fundamental criteria.

For the first 2 targets I have used per analysis of SAR, RRL and SBM. They are all targeting 300koz pa + production. MCAPs range from $2.35B to $2.49B.

The third target is based on EBITDA and a peer average P/E of 18.8.

Peers own 100% of their resources whereas Gold Road is in a 50:50 JV for their project.

1. $1.68 - On a reserve basis we should be at a Market Cap of around $1.48B or $1.68 per share based on peer analysis of reserves for SAR, RRL and SBM.
2. $1.05 - On peer analysis derived from MCAP of producers. Using a production basis of 275koz implied from mining plan for the first year, the target is $1.05 per share based on a peer-derived market cap of $923M.
3. $1.51 - at peer average P/E of 18.8. I've adjusted 275 koz-based EBITDA for 50% ownership and then made an assumed allowance for Depreciation and Amortisation ( I assumed 20 year life of assets for GOR share of direct CAPEX ) before working out an NPAT @ $70.2M. Target in this case is $1.51. This reflects gold price at USD $1302 or AUD $1813.

In the analysis I've applied normalisation for GOR's 50% ownership of the project.

I've taken capital structure from the latest Appendix 3B to determine approximate share issue for June 2019 of 877M.

Share price estimates don't take into account exploration upside.

Essentially due to the movement in the gold price since 9 December my targets have lifted by about (9% to 24%), depending on the target.




For best understanding of current status, watch the video below but here is a quick summary:

• Gold Road down to the last 10% of work for the construction of their mine.
• Still on track for first gold in Q2 of 2019.
• Project updates in next couple of weeks.
• Expect to be at nameplate production capacity by end of year