The hits keep coming for Pan African Resources PLC (AIM:PAF, OTCQX:PAFRY, JSE:PAN, OTCQX:PAFRF), but the market continues to undervalue the AIM-listed gold explorer, according to analysts at broker Peel Hunt.
In a Thursday operational update, Pan African announced it has finalised the acquisition of Tennant Consolidated Mining Group (TCMG).
The group also raised production guidance for fiscal year 2025 to approximately 215,000 ounces, a 16% increase compared to the previous year.
“Added to the growth from the recently acquired Tennant project and the potential from Egoli and the Sheba fault zone, it looks like management is gearing up to push production to well over the (300,000 ounce per year-plus) run rate we expect by the end of FY26E," said the broker.
“Management also noted that the MTR development came in under budget and rather than resting on its laurels, is pressing ahead with studies into expanding the plant, as well as a second one,” added analysts.
Yet with shares currently trading at a 4.1 times forward price-to-EBITDA ratio, “we do not believe the growth from assets in development or ramp up is priced in”, said Peel Hunt.
Shares inched up 1.2% to 38.85p a pop on Thursday.