Citi Research believes the spectacular rally in Evolution Mining shares is now largely complete, resulting in it downgrading the gold miner to neutral overnight.
“We increase our target price for EVN by 50 cents [to $4.90], driven by higher AUD gold prices expectations,” Citi said. “However, we downgrade to neutral after a 40 per cent monthly share-price gain.”
Despite the downgrade, Citi believes there’s upside risks to its call, driven by near-term cash flow rather than fundamental factors.
“Our bull case for higher gold prices is $5.70 per share,” Citi said.
Macquarie also liked the gold miners Q3 production, lifting its price target to $5.40, nearly 30 per cent above the level forecast previously. It retained an outperform rating.
Evolution, like most gold miners today, is sitting in positive territory, gaining 1.8 per cent to $5.16.