tiprankstipranks
Why did gold miner, St Barbara (ASX:SBM) shares crash today?
Market News

Why did gold miner, St Barbara (ASX:SBM) shares crash today?

Story Highlights

St Barbara shares fell steeply, after the Australian gold miner announced a downgrade in production targets. However, analysts and financial bloggers remain mostly bullish on the stock, according to TipRanks insights.

St Barbara Ltd. (ASX:SBM) shares plunged as much as 22% to hit a new 52-week low of AU$0.52. Investors fled SBM stock after learning about the Australian gold miner’s production issues. However, analysts continue to believe that SBM stock is still worth having, according to TipRanks insights.

Labour and equipment shortages

Investors reacted badly after St Barbara announced a sharp reduction in its production targets. The company now aims to produce between 260,000 and 290,000 ounces of gold in FY23. It previously aimed to produce 280,000 to 315,000 ounces of gold.

The company blamed labour and equipment shortages for the production cut. These challenges have also led the company to push back capital spending on some major projects by up to 12 months. While it initially aimed for FY23 growth capex of between AU$95 million and AU$120 million, St Barbara has now cut the spending to between AU$53 million and AU$70 million.

St. Barbara share price prediction

St Barbara shares have dropped about 50% year-to-date, as soaring interest rates have turned many investors to bonds and away from gold. According to TipRanks’ analyst rating consensus, SBM stock is a Moderate Buy based on three Buys and four Holds. The average St Barbara share price prediction of AU$1.13 implies over 112% upside potential.

Moreover, St Barbara stock is receiving favourable mentions on financial blogs. TipRanks data shows that financial blogger opinions are 71% Bullish on SBM, compared to a sector average of 73%.

Disclosure

Trending

Name
Price
Price Change
S&P 500
Dow Jones
Nasdaq 100
Bitcoin

Popular Articles