The Western Areas Ltd (ASX: WSA) share price has been a solid performer on Thursday morning.
In early trade, the nickel producer's shares are up 4% to $2.55.
Image source: Getty Images
Why is the Western Areas share price charging higher?
The solid gain by the Western Areas share price today has been driven by the release of its quarterly production and sales update.
In respect to production, Western Areas reported total nickel in concentration production of 4,622 tonnes for the quarter. This was the strongest three months of FY 2021, resulting in full year production of 16,180 tonnes.
The strong quarterly production result was underpinned by an increase in total milled ore and stronger average recovery rates.
Sales update
The release explains that Western Areas' June quarter nickel sales were impacted by a timing variance related to the final export shipment leaving port after the end of the financial year.
As a result, the provisional total volume of nickel in concentrate sold for FY 2021 is estimated at 15,500 tonnes, subject to final assay results. The remaining 820 tonnes that missed the year-end deadline will be reported as sales and cash flow in FY 2022. It was also be accounted for as finished goods inventory, rather than revenue for FY 2021.
Is it too late to invest?
One broker that has been very bullish on Western Areas recently in Ord Minnett. And while the broker has yet to respond to this update, it currently has a buy rating and $3.20 price target on the company's shares.
Based on the current Western Areas share price of $2.55, this implies potential upside of over 25% for its shares over the next 12 months.
Though, investors may want to wait to see what it thinks about this update before acting on its previous recommendation.
