Brightstar Resources Ltd (ASX: BTR) is being overlooked by investors at the moment, according to the team at Shaw and Partners, which has tipped the emerging gold producer to more than triple in value as its projects come into production.
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Projects already well-progressed
Shaw and Partners analysts said that, between the company's Goldfields and the Sandstone projects, Brightstar has a "realistic path" to producing 275,000 ounces of gold per year from FY31.
The analysts said in a note to clients this week:
In our view, the market is heavily discounting BTR's project delivery. However, we find both projects relatively low-risk, standard WA gold operations. Goldfields has already commenced construction with first gold due in JunQ'27. Sandstone may be early-stage but has permitting and technical advantages, plus considerable Resource upside potential. Market confidence could be aided with two Resource updates, a maiden Reserve, and prefeasibility study expected in 2H CY26.
Brightstar made a final investment decision to proceed with the Goldfields project in May, saying at the time it was fully funded through to first gold following the completion of a $193 million equity raising and a US$120 million bond financing.
The project was expected to produce about 75,000 ounces of gold per year over the initial six-year mine life, generating about $1 billion.
Brightstar Managing Director Alex Rovira said regarding the project:
Today's Final Investment Decision is a landmark moment for Brightstar. With all key approvals now secured, funding in place and the EPC contract executed with GR Engineering, we are immediately moving into full construction of the 1.5Mtpa Laverton processing plant. It marks the first major step in our TARGET200 strategy to build a multi-asset Western Australian gold producer and advance our aspiration of being a Top 10 Australian Gold Producer. We are fully funded, highly motivated and focused on executing with discipline to deliver this transformative project on time and on budget whilst continuing to unlock further value across our Goldfields and Sandstone assets.
The Shaw and Partners team said the Goldfields project posed low technical risk and believed the mine would eventually produce one million ounces of gold.
They said that at an earlier stage of the Sandstone project, they expected production to peak at 200,000 ounces per year and that the gold resource could "materially increase" in the second half of this calendar year.
Shares looking cheap
The analysts added that, looking at peer group companies, a market capitalisation of $2 billion was reasonable.
Brightstar's current market capitalisation is $323.9 million.
Shaw and Partners has a $1.15 price target on the company's shares compared to 28 cents currently.
