Shares in gold and copper miner OZ Minerals Limited (ASX: OZL) look set to make a new 52-week high any day now.
With the stock up 4.5% today to $4.59, up around 9% from when I highlighted the stock in late June, and up 44% since the start of 2014 investor enthusiasm for the miner has certainly turned from the $2.11 low it plunged to in December 2013.
Last year OZ Minerals faced a 'perfect storm' of problems ranging from a mine wall slippage caused by heavy rains at its flagship Prominent Hill mine in South Australia to a weak gold price. More recently however the company has been experiencing a string of positives. These positive have included a steadying in the gold price, which has also helped Newcrest Mining Limited's (ASX: NCM) shares rally over 40% this year, better-than-expected production volume figures and exciting resource and reserve estimates.
What's to love?
With significant net cash and equity investments including an 18.9% shareholding in Sandfire Resources NL (ASX: SFR) which is currently worth around $190 million, investors love the strength of OZ Minerals' balance sheet. Added to this is the increasingly positive news flow regarding the miner's resource assets. Recently OZ announced its pleasing initial mineral resource estimate from the Khamsin deposit located near its Carrapateena project. OZ has also recently increased its ore reserve estimate at its Malu Underground deposit, which importantly has the potential to prolong the production life or volumes to be extracted from the key Prominent Hill operation.