If you're looking for options in the gold sector, then Capricorn Metals Ltd (ASX: CMM) shares could be worth considering.
That's the view of analysts at Bell Potter which have just upgraded the ASX 200 gold share.
Why is this ASX 200 gold share a buy?
Bell Potter has been running the rule over Capricorn Metals and likes very much what it sees.
In fact, the broker highlights that Capricorn Metals is "a sector leading gold producer with strong balance sheet and a management team that has an excellent track record of operational delivery."
Its analysts also note that its "costs are among the lowest in the sector and consistently generates strong cash margins."
It is for this reason, as well as its attractive valuation, that the broker has upgraded its shares to a buy rating with a $4.90 price target this morning.
This implies potential upside of over 16% from where the ASX 200 gold share closed yesterday's session.
What else did the broker say?
Bell Potter notes that Capricorn Metals screens well and has been performing either in-line or ahead of expectations since first pouring gold. That's quite an achievement in the current environment. It said:
CMM continues to screen as one of the top performing ASX-listed gold producers. Since pouring first gold in June 2021, it has successfully ramped up production at its 100%-owned KGP and delivered production and costs either in-line or ahead of guidance. CMM's on target performance has positioned it as a sector leader in terms of cash generation. Since declaring commercial production in the September quarter 2021, we calculate total addition of cash and bullion to the balance sheet of A$109.2m for average cash build of A$520 per ounce produced.
