Ramelius Resources extends selloff as Mt Magnet plan disappoints
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The news: Gold miner Ramelius Resources saw its shares plummet for the second straight session after outlining lower-than-expected production guidance for its Mount Magnet mine in Western Australia.
The numbers: Ramelius shares were down 9.5% to $2.09 at 11am AEDT, making it the worst performing ASX 200 stock, having dropped by around 17% on Tuesday.
Macquarie retained its 'neutral' rating on Ramelius but slashed its target price 19% to $2.10. It also reduced its earnings forecasts for the miner by 4% in FY25, 37% in FY26, 5% in FY27, 86% in FY28, 97% in FY29 and 80% in FY30.
Shaw and Partners kept its 'buy' rating but cut its target price from $2.98 to $2.89.
The context: Macquarie analysts said that Ramelius' mine plan for Mount Magnet fell short of market expectations for average annual production, with capital expenditure "materially higher".
However, they flagged that exploration success at its Penny gold mine, around 150km south-east of Mount Magnet, could "materially improve the outlook".
Shaw and Partners analysts also noted potential upside from further extensions at Penny, as well as additional material from Ramelius' Cue gold project.
The sources: Macquarie research, Shaw and Partners research
