Hochschild Mining PLC (LSE:HOC, OTCQX:HCHDF), up 5% on Monday, is poised for a significant rebound, according to RBC Capital's latest analysis.
The company is expected to unveil a three-year production and cost guidance at its Capital Markets Day on 22 November, which is anticipated to highlight improvements in production and cost efficiency.
This optimism is largely driven by the upcoming commissioning of the Mara Rosa project and the mining of higher-grade areas at Inmaculada.
RBC Capital maintained an 'outperform' rating for Hochschild, with a price target of 130p for the shares, suggesting confidence in the company's future performance.
As mentioned above, the key factors influencing this outlook include the successful commissioning of Mara Rosa in the second quarter of 2024 and the expected increase in gold equivalent production by approximately 30% from 300,000 ounces in 2023 to 382,000 ounces by 2026.
This increase in production is set to reduce the all-in-sustaining cost (AISC) significantly, from around $1,600 per ounce in 2023 to $1,340 per ounce by 2026.
The report also highlights potential challenges and areas of focus, such as the impact of permitting delays at Inmaculada, exploration success at San Jose, and the ramp-up of Mara Rosa.
Additionally, updates on capital expenditure for Pallancata's Royropata deposit and potential changes in permitting regulations are expected.
At 2.25 pm, the stock was changing hands for 108p, up 5.1p on the day.