Article by Macqurie today, http://asx200.caresuper.com.au/files/DailyBulletin20090831.pdf
Earnings revision
We have downgraded our 2009 earnings per share forecast by 1.2c per share to 0.5c per share following the First Half 2009 results; we note there is material upside to our forecast given the spot price scenario outlined above.
Price catalyst
12-month price target: $0.45 from $0.50. Catalyst: Ability to deliver into 2009 production guidance.
Action and recommendation
We cut our rating to Neutral and reduce our price target to $0.45 per share. We acknowledge Panoramic Resources (PAN) has leverage to the copper price and is likely to perform well if copper rises. However, in a relative sense we prefer OZ Minerals (OZL) for leverage to the copper price in the short to medium term, as we are more comfortable with the ramp up at Prominent Hill compared to Phu Kham. Longer term, we think Equinox (EQN), through Lumwana, provides investors with a project of superior scale and more value add brownfield expansion potential.
PNA Price at posting:
$2.03 Sentiment: Sell Disclosure: Held
