BGL is a rare friendless gold stock due to its operational setbacks, production downgrades, and balance sheet concerns. However, in an environment where it’s cheaper to buy a gold mine than build one, this $1.238bn company could be attracting the attention of polished operators thinking we could do a better job. BGL presents a classic “turnaround opportunity” acquisition target with high-quality assets trading at a discount due to operational & management missteps – the stock has more than halved from its 2024 high. If they could get it wrong, they have, from unfavourable hedging to a 20% production guidance cut for FY25. BGL has a substantial resource, which is still ramping up production after starting in 2023.
- We can see gold companies running the ruler across BGL, which could keep the stock well supported ~85c.
- The trouble is from an investment thematic; if nobody bids for BGL, it’s not close to the top of ASX gold miners that MM likes.
MM is cautiously bullish on BGL
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