Raj Ray, an analyst from BMO Capital, reiterated the Buy rating on Anglogold Ashanti PLC (AU – Research Report). The associated price target is $26.00.
Raj Ray has given his Buy rating due to a combination of factors, including Anglogold Ashanti PLC’s positive first-quarter free cash flow, which marks a notable improvement from the previous year. Additionally, the company’s management has confirmed their production guidance, projecting a stronger performance in the second half of the year, with the fourth quarter expected to be particularly robust. Despite early-year operational challenges caused by mine sequencing and adverse weather conditions, there is an expectation of gradual improvement as the company’s asset optimization program is now being implemented.
Furthermore, Raj Ray’s optimism is bolstered by successful trial mining using a new method at the Obuasi mine, which is anticipated to significantly contribute to production rates in the coming quarters. The report also highlights Anglogold Ashanti’s continued reporting under IFRS, ensuring its presence in emerging market indices and mitigating the risk of negative index-related flows. Ray sees potential in the company’s new approach to portfolio management, which could lead to a more streamlined set of high-value assets, providing an additional rationale for the Buy rating.
AU’s price has also changed dramatically for the past six months – from $15.900 to $24.380, which is a 53.33% increase.
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Anglogold Ashanti PLC (AU) Company Description:
Anglogold Ashanti Ltd is one of the largest gold miners. The company also produces silver and sulphuric acid as by-products. Its operating divisions are Africa, Australia, and the Americas. The firm generates a majority of its revenue from Africa which includes Ghana, Guinea, Mali, the Democratic Republic of the Congo, and Tanzania.
