OZL +1.08% : Peter O’Connor upgrading OZL today to a buy on valuation grounds, saying: Earnings updated for guidance update (27 June 2022) including lower production and higher unit costs, West Musgrave start-up (pushed back one year) and tweaks to capex and D&A, (ii) Target price multiple to NPV lower from 1.25x to 1.1x and (iii) Rating Upgrade to BUY from HOLD on valuation (trading at discount to fair value for the first time in 2 years and potential overshoot vs commodity price. Worth noting that commodity equities follow the commodity price on ~90-95% of occasions, so with the copper price down ~22% from 2022 high and OZL down ~35% the share price drawdown looks to have gotten ahead of itself.
MM are bullish & now long OZL
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