S&P/ASX 200 Index (ASX: XJO) gold stock West African Resources Ltd (ASX: WAF) has made some very happy investors this past year.
How happy?
Well, in afternoon trade on Monday, West African shares are up 2.6%, changing hands for $2.74 apiece. One year ago, you could have bought shares for $1.33 each.
That puts shares in the Perth-headquartered ASX 200 gold stock up a whopping 106.0% in just 12 months. Or enough to have more than doubled your investment.
Part of that strong performance stems from the gold miner's own successes in the field.
And part, as you're likely aware, has been driven by the surging gold price. Gold is currently trading for US$3,376 per ounce. That sees the yellow metal up 73% in 12 months.
But if you think it's too late to potentially bank more oversized gains from the gold miner, the analysts at Macquarie Group Ltd (ASX: MQG) beg to differ.
Why the ASX 200 gold stock could keep charging higher
In a report released on Friday, Macquarie drilled into West African Resources' updated 10-year production outlook.
The ASX 200 gold stock reported on that outlook last Wednesday, forecasting an uplift in production at its flagship assets, located in Burkina Faso.
Macquarie noted that the miner's updated 10-year mine plan forecasts a total of 4.8 million ounces of gold production over calendar year 2025 to 2034. That's 12% higher than consensus estimates and 8% above Macquarie's own estimate.
West African expects to achieve an average annual gold production of around 480,000 ounces over this period.
According to Macquarie:
A key update this year is the inclusion of an additional secondary crusher at both Sanbrado (in 1QCY29) and Kiaka (in 1QCY28) to sustain respective "fresh ore" throughput levels of 3Mtpa and 10Mtpa respectively into the future.
The increase in annual production (vs WAF's prior plan) largely occurs over CY29-34 with smaller increases over CY25-27 and is driven by both the crusher installations and inclusion of Toega UG (Sanbrado) in the mine plan.
Commenting on the ASX 200 gold stock's updated production plan last week, West African CEO Richard Hyde said, "Our unhedged resources now stand at 12.2 million ounces of gold and Ore Reserves at 6.5 million ounces of gold."
Hyde added, "We see potential to boost annual production further through targeted drilling programs extending M5 South underground, beneath M5 North open-pit and infilling Toega underground targets."
Macquarie labelled the production increase "a net positive" and maintained its outperform rating.
The broker also increased its 12-month target price for the ASX 200 gold stock by 3% to $3.40 a share. That represents a potential upside of more than 24% from current levels.
