Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.
What are your thoughts on WAF? They traded a very low PE of 4.9 and are expected to double gold production in 2025 with the opening of a new mine. The share price has been going backwards, despite broker price targets of 2x to 3x the current price. Many thanks
Hi Robert,
One of the main themes across equity markets over the last few years is the weak keep getting weaker and that certainly has applied to WAF which has halved from its 2022 high, even as gold makes fresh all-time highs. A few reasons here that can be categorised as geopolitical risk, balance sheet risk & development risk.
The downturn started in earnest back in 2022 after a political coup in Burkina Faso caused major concerns around the company’s mining operations in the West African nation – investors stance has been simple, if in doubt stay out. In August the stock bounced following the release of its half-yearly results but its subsequently resumed its downward move.
We prefer Westgold Resources (WGX) for exposure to precious in this end of the market, i.e. miners with a market cap between $800mn and $1bn.
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