Stumbling miner to 'polish up well'

Regis Resources rose 12.5 cents to $3.975 at 1228 AEST today after Citigroup upgraded the gold miner to a 'buy' despite three production downgrades in six months at Regis’ Garden Well mine.

Citigroup says the stock may rise to $4.80.

“We like RRL’s assets and organic growth story,” says Citi in a note. “Following recent share price weakness we see attractive value in the name.”

The broker says rainfall at Garden Well caused handling issues at the mine’s crusher to resurface. But Citi says the company’s assets are “operationally attractive” relative to its peers. Regis’ Australian location means it avoids political risk, the broker says.

Citi’s gold price forecast is $US1650 an ounce for the next two years. Its longer term forecast for the gold price is $US1050 an ounce.