Peter Bisztyga, an analyst from Bank of America Securities, reiterated the Buy rating on Novagold Resources New (NG – Research Report). The associated price target is p1,150.00.
Peter Bisztyga has given his Buy rating to Novagold Resources New due to a combination of factors. The significant capital expenditure pipeline in both the UK and US, particularly in the electricity sector, is a strong point. Furthermore, the full regulatory visibility in the UK until 2026 and 2028, along with the potential for improved returns in the US by 2024, add to the stock’s attractiveness. Additionally, the inflation and interest rate hedges that are part of their respective regulatory frameworks provide a safety net. EPS downgrades since May, mainly due to changes in UK tax, do not affect the Net Present Value (NPV).
Novagold’s ambitious plans for all its markets, including the UK, New York and Massachusetts, to reach Net Zero by 2050 also contribute to the Buy rating. The company’s track record of consistently earning returns above its cost of capital is expected to continue. Novagold’s capital expenditure is projected to rise from £8.3 billion in 2024 to £12 billion by 2031. The asset base CAGR for 2022-2026 is estimated to be 11%, above the guidance of 8-10%. In addition, the company’s full regulatory visibility in the UK and potential upside in the US, along with inflation and rising interest rate protection, enhance the attractiveness of the stock.
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Novagold Resources New (NG) Company Description:
NovaGold Resources, Inc. engages in the acquisition, exploration, and development of metal properties primarily located in Alaska and British Columbia. Its developments include Donlin Gold and Galore Creek projects. The company was founded by Gregory Shawn Johnson, John W. Chisholm, Macisaac G. Angus, Rick van Nieuwenhuyse, and Gerald James McConnell on December 5, 1984 and is headquartered Vancouver, Canada.
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