OZ Minerals is Citi's top pick in the copper space and has a "buy" on the miner with a target price of $5.50 a share.
It describes the company as "a low-cost producer (around $US1.06/lb Cu for FY16e), with increasing revenue and free cash flow from forecast higher $A copper prices and weakening AUD".
Citi's top picks in the Small Caps space include: Karoon (KAR) (buy/high risk, price target $4.68) – KAR is trading below cash value, with the company having announced it intends to continue the buyback of shares which is DCF accretive at the current share price and limits investor's downside.
"The share price hence provides a free option on Brazil, which we see as in the second quartile of Citi's global cost curve for incremental supply.
"Upcoming catalysts include updated resource sizes for Kangaroo and Echidna (September), asset farm down and announcement of development plans (we expect mid-CY16).
"We see little risk with respect to cash burn ahead of these catalysts given KAR's cash is largely held in US dollars, and hence the company benefits from further weakness in the AUD.
"Based on previous comments by the company, we think KAR may be interested in acquiring producing assets to provide it with cash flows ahead of executing on Brazil
Some Positives for Karoon.
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Last
$1.80 |
Change
0.035(1.98%) |
Mkt cap ! $1.442B | |||
| Open | High | Low | Value | Volume |
| $1.79 | $1.83 | $1.78 | $12.59M | 6.979M |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 3 | 41814 | $1.80 |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| $1.80 | 46131 | 2 |
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| Last trade - 16.10pm 26/06/2024 (20 minute delay) ? |
| KAR (ASX) Chart |