Analysts from Canaccord Genuity have recently been on-site visits with both Paladin Energy Ltd (ASX: PDN) and Deep Yellow Ltd (ASX: DYL) and have come away impressed with what they saw.
With regard to Paladin, the CG team said its Langer Heinrich mine in Namibia continues to perform strongly, following an impressive December quarter in which production beat consensus estimates.
And they believe the company will do even better, as they said:
While Paladin will not update its 4.0-4.4Mlb guidance until after the March quarter, we have revised our FY26 forecast to 4.7Mlb. Commissioning of the mining fleet is trending ahead of estimates and the process is delivering stable results. We retain our buy rating and sum-of-the-parts $16.00 per share price target after incorporating minor changes.
Paladin's current share price is $13.14.
In a separate report looking at Paladin's half-year results, the CG team said it was broadly in line with expectations.
They added:
While operations were only marginally cash flow positive at US$3.3m, we see Langer Heinrich at a key inflection point, with a ramp up in free cash expected over the near term. The mining fleet has now been successfully commissioned, low grade stockpiles are largely run down, and the plant continues to ramp toward full capacity. The site visit provided incremental confidence, and we remain comfortable that a strong 2H will deliver a FY26 beat on both production and costs.
Image source: Getty Images
Decision to mine looms
Over at Deep Yellow, the CG team is also bullish on the stock.
Deep Yellow is at a different stage of development, with the company yet to make a final investment decision at its Tumas project in Namibia.
The CG team said the company was playing its cards well, while also getting on with the job.
As they said:
Deep Yellow is being strategically patient regarding a final investment decision for Tumas, but it is very busy on the ground and has demonstrated a willingness to spend on long-lead items, thus retaining 2028 first production flexibility. With the independent technical engineering report complete, lead arranger Nedbank discussing syndication and the term market heating up, confidence in a medium-term final investment decision is growing.
CG said Deep Yellow currently had 100 people on the ground at Tumas, with most involved in bulk earthworks, while noting that detailed engineering for the project was about 60% complete.
They said Namibia was also the only country in sub-Saharan Africa to have a US ambassador on the ground, which could prove to be useful going forward.
CG has a price target of $3.01 on Deep Yellow shares compared with $2.54 currently
