RRL has shrunk to a $1.9bn junior over recent years to find itself as a takeover target as the sector hears up – it’s trading on 11.5x Est 2025 earnings, making it relatively cheap compared to heavyweights Evolution (EVN) and Northern Star (NST). The company appears to have stabilised operationally after its most recent quarterly, RRL maintained its FY production and cost guidance, with a forecasted All In Sustaining Cost Base (AISC) for FY24 ranging between $A1,995-2,315 per ounce, or around $US1400 at the mid-point.
Discussions appear to be in the wind; Regis managing director Jim Beyer, while not confirming any specific, acknowledged that the sector’s size makes such conversations common. “Everybody’s probably chatted to everybody,” Beyer said, stressing the importance of creating value for shareholders in any potential deals.
- We like RRL around $2.50 with the possibility of a bid cream on the proverbial cake.
MM is bullish toward RRL
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