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Gold Fields (NYSE:GFI) +0.8% in Wednesday’s trading as BMO Capital upgrades shares to Market Perform from Underperform with a $14 price target, emphasizing the importance of the miner’s operational consistency.
BMO’s Raj Ray says Gold Fields (GFI) stock has lagged peers despite higher gold prices because of setbacks with respect to Salares Norte’s ramp-up delays, subsequent guidance revision, and operational volatility, but he believes the market now has better visibility on the potential operational risks, and that the stock valuation now is more in line with peers.
While Gold Fields (GFI) has faced operational volatility over the last 12-18 months, its track record since 2020 has been commendable, the analyst says, adding the relatively new senior management team is expected to take steps to improve productivity and ensure steady progress, particularly with Salares Norte.
Gold Fields (GFI) also maintains a robust balance sheet and liquidity position, with a manageable net debt to EBITDA ratio and access to a sizable revolving credit facility, Ray writes.