The St Barbara Gold Ltd (ASX: SBM) share price closed 1.2% higher at $3.22 today but still sits around 21% lower than the $3.90 per share 12-month price target slapped on it by powerful analysts at Goldman Sachs.
For the six-month period ending December 31 2018 St Barbara posted a net profit after tax of $82.6 million on revenue of $332 million that allowed it to pay out $41.6 million in dividends or 4 cents per share.
It has 524 million shares on issue to give it a market cap of $1.69 billion based on today's share price.
On March 22 2019 it updated investors on operations at its Gwalia gold mine to reveal that it anticipated total production between 235,000 to 240,000 ounces of gold in fiscal 2019, at an all in sustaining cost between $980 to $1,000 an ounce.
For fiscal 2020 it expects production between 200,000 to 220,000 ounces with production above 230,000 ounces for FY 2021 and FY 2022.
After Goldman Sachs "rebased" their assumptions for total production out of St Barbara on the back of the Gwalia mine operating update it still came up with a $3.90 price target.
St Barbara like other Australia-based gold miners such as Northern Star Resources Ltd (ASX: NST) or Newcrest Mining Limited (ASX: NCM) benefits at the Australian dollar falls in value. This is because a lot of the miners' operating costs are in Australian dollars, but revenues are in U.S. dollars as this is the currency physical gold is traded in.
Given analysts are tipping the RBA to cut cash rates up to twice in 2019 the local gold miners may finish the year higher than where they are today.
