The Aeris Resources Ltd (ASX: AIS) share price is trading at 20.5 cents a piece in morning trade, down 2.38% over the day so far. For the year, the share price is 2.5% higher.
But Macquarie Group Ltd (ASX: MQG) analysts think there is potential for much more upside from the small-cap miner.
In its latest note to investors, the broker has raised its price target to 28 cents per share, up from 27 cents earlier this week. That represents a potential upside of 36.58% for investors over the next 12 months at time of writing
Macquarie has maintained its outperform rating on Aeris Resources shares.
Here's what the broker has to say.
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Production guidance is above expectations
In its investor note, Macquarie explains that its upgraded valuation is due to higher FY 2026 and FY 2027 production expectations.
Aeris Resources released its FY 2026 copper production guidance of 24-29kt. The midpoint of 26.5kt is 36% higher than prior Macquarie forecasts. The guidance volume is also 9% higher than Visible Alpha (VA) consensus of 24.4kt. FY26 copper guidance is also 6% higher than FY25 actuals (at the midpoint).
FY26 gold production guidance of 44-56koz, and the midpoint of 50koz, is 4% below Macquarie forecasts. The new figures are also 6% higher than VA consensus of 47.3koz.
"We update our FY26E forecasts toward the lower end of production for Cu/Au/Ag [copper/gold/silver] guidance and the upper end of operating cost guidance as we take a conservative approach to the year ahead, noting the production skew in the 2HFY26 at Tritton (2H responsible for 61% of production on MQe forecasts). We take the midpoint of sustaining, growth, and exploration guidance for our FY26 forecasts", the broker said in its note.
Incorporating FY 2026 guidance towards the low end of production, and higher end of costs results in a 9% earnings per share uplift for FY 2026, Macquarie analysts said.
"FY27E EPS also increases 7% as we decrease costs at Tritton and Cracow (in line with FY26 guidance)".
"Our TP increases 4% to A$0.28/sh due to FY26E/27E EPS increases. Our TP methodology of 50/50 blend of NPV and 4.0x EV/EBITDA is unchanged", Macquarie noted.
"With the balance sheet headwinds pushed out for now (WHSP facility refinanced to Aug-2026), AIS can focus on achieving guidance objectives in FY26", Macquarie said.
Macquarie is clearly optimistic about the precious metals producer's outlook, but it notes that its investment thesis and forecast are at risk from movements in copper, gold, and zinc prices. Exchange rate fluctuations could also affect the producer's actual earnings result.
The broker notes that potential divestments of non-core assets could provide upside/downside risks to forecasts. Operational issues, including potential geotechnical issues or environmental impacts, could also present a downside risk.
