Street Calls of the Week
Investing.com - UBS has initiated coverage on Zijin Gold International (2259:HK) with a Buy rating and a price target of HK$189.00, according to a research note released Thursday.
The investment bank views Zijin Gold, a spun-off subsidiary from Zijin Mining’s overseas gold operations, as a quality miner with a proven track record in operational execution and earnings delivery.
UBS expects Zijin Gold to deliver approximately 20% volume compound annual growth rate (CAGR) from 2025 to 2027, with total production increasing from 45 tonnes to 65 tonnes during this period.
This production growth, combined with UBS’s bullish outlook on gold prices, is projected to result in a 30% earnings CAGR for Zijin Gold over the same timeframe. UBS has upgraded its gold price forecasts to US$3,320, US$3,825, and US$3,650 per ounce for 2025, 2026, and 2027 respectively, which is 7% above consensus estimates.
The HK$189 price target represents a premium valuation of 30 times 2026 estimated price-to-earnings ratio, compared to the 15-25 times range typical for Hong Kong and China gold miners, reflecting Zijin Gold’s robust earnings growth potential and proven quality.
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