Here is the reason why:
theaureport.com
Ticker: JSE/NYSE-GFI
Description: Gold Fields Limited is one of the world’s largest gold mining companies with operations in South Africa, Australia, and Ghana. The Company’s unhedged position makes it a leading play for the gold and precious metals investor.
Website: goldfields.co.za
Recent Investor Information
The information below is based on the most recent information we have received from analysts and the companies participating in The Gold Report. We encourage you to visit the company's web site for updates.
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“The updates to our forecasts for recent corporate developments have boosted our valuation and forecasts slightly. Our revised forecasts include the ZAR1.3 billion equity raising in November, the St. Ives expansion, the Mvelaphanda deal, and the US$7.3 million purchase of Fujian Zijin. The production, cost and earnings forecasts do not include production from the recently acquired Cerro Corona project in Peru. The net impact is a modest increase in production and earnings.
Our valuation increased following the recent developments (assuming
unchanged commodity and exchange rate forecasts). Gold Fields shares are currently the most attractively priced South African gold equities, at a premium of only 12% to our spot NAV. Our $18.25 target price is based on the
following target multiples: 35% premium to our 0% NAV (at $430/oz gold),16x 2005E CFPS, 25x 2005E EPS and $150/oz adjusted market capitalization.
We rate Gold Fields Outperform. The company has a strong management with a track record of valuing adding transactions, a solid balance sheet and is strengthening its position outside of South Africa.“ (January 15, 2004)
-GEOFF STANLEY, BMO NESBITT BURNS
“We have some of our larger holdings in South Africa in Gold Fields and Harmony. They’ve been a disappointment this year, entirely due to the extremely strong Rand that has driven up their costs. I can’t see the Rand getting much stronger from here; in fact, I think it’s in the process of topping out. I think it will start to weaken at the end of the year and into next year. So that should benefit South Africa, and I think we will see much better performance from those stocks in the coming year. (October 28, 2003)”
- JOE FOSTER, VAN ECK INTERNATIONAL INVESTORS GOLD FUND
“We like Gold Fields’ exposure to gold price movements and its strong balance sheet. Although exchange rate movements (i.e. a stronger rand and Australian dollar) , higher energy prices and lower grades mined at the South African operations adversely impacted cash costs of production in the quarter, an improvement in productivity helped to drive unit costs lower (i.e. rand per ton costs). More specifically, we think Gold Field’s share price is largely discounting the strong rand and that its valuation is more sensitive to gold price movements versus exchange rates. As we remain bullish on gold’s outlook, we think Gold Fields is an attractive investment vehicle to get exposure to the commodity.” (May 13, 2003)
-MICHAEL DUROSE, MORGAN STANLEY
“We retain our Overweight recommendation on Gold Fields relative to the resources sector, with the resources sector recommended underweight. We currently value Gold Fields at R80.23/share versus the current share price of R87.25. Our twelve-month target price is R95.95/share.”(August 1, 2003)
-PETER TOWNSHEND, BARNARD JACOBS MELLET SECURITIES
“We continue to favor . . . Gold Fields (GFI, $11, target $19). . . With Gold Fields, we like the stock’s exposure to gold price movements and the company’s strong balance sheet.” (May 26, 2003)
-MICHAEL DUROSE, MORGAN STANLEY
“It has a solid balance sheet with an appealingly simple corporate structure and quality, long-life asset base. We believe it remains an attractive investment vehicle for a rising gold price environment. Our cautious outlook is based on its relatively smaller upside to fair value versus others in our gold universe and its exposure to a strong rand.” (May 15, 2003)
-ALBERTO ARIAS, GOLDMAN SACHS |
