Mackie Research on Thursday upped its rating on Mandalay Resources Corporation (TSE:MND) (OTCQB:MNDJF) to a Buy with an increased price target thanks to upbeat production figures from its Australian and Swedish gold operations.
The Toronto-based miner produced a consolidated 25,677 saleable ounces of gold equivalent in its first quarter, up from the 21,940 ounces produced during the same three-month period a year ago.
Overall, the production increase was propelled by the high-grade Youle vein at Costerfield in Australia, which saw gold production lift by 36% and antimony increase by 62% compared to the most recent quarter.
READ: Mandalay Resources maintains 2020 production guidance as Costerfield delivers highest output since 2016
Costerfield produced nearly 15,000 saleable equivalent ounces, the highest level of production since the second quarter of 2016 and including a record 1,108 tons of antimony.
As a result of what Mackie called a “fantastic start to 2020,” analysts upgraded their rating to Buy from Speculative Buy and hiked their price target to $2.75 a share from $2.15 a share.
Mandalay’s stock recently traded up 5.7% to C$1.11 a share in Toronto.
“We now expect production to increase from 95,000 ounces in 2020 to 125,000 ounces in 2021 (essentially unchanged) and for total cash costs to decrease from US$658/ounce to US$573/ounce, net of credits,” analysts wrote.
“Going forward, our projections benefited from higher year-end reserve and resource grades at Costerfield and more underground tonnes at Bjorkdal.”
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