Nevsun Resources Ltd. (NSU, Financial) closed the week with a positive sign after the release of financial results for the entire year. Its stock jumped 4% to $2.29 per share.
However, despite the most recent upside, the stock is still trading underneath the 200 and 100-SMA lines while emulating the 50-SMA line. What's more, in early Monday trading, the stock slid by 2% to $2.24 a share.
However, for the 52-weeks through March 2, Nevsun Resources’ return is still below zero with a loss of 11%.
The stock has a 52-week range of $1.96 to $2.77 per share.
The most important financial figures tells that the fourth-quarter of 2018 closed with a loss of 1 cents per share attributable to the shareholders of Nevsun Resources, which has been dropped by a quarterly income statement’s top line of $80.6 million. The fourth quarter revenue, reported by the base metal producer for fiscal 2018, was 122.7% increase on a year over year basis.
While expectations on earnings were missed by 2 cents, Nevsun Resources beat consensus on fourth-quarter revenues by 3.3 million.
The company closed full fiscal 2017 with cash on hand and securities of approximately $125 million and total current assets exceeding total current liabilities with $162.3 million. From the previous fiscal cash available on hand and working capital decreased by $74.7 million and $38.8 million due to a massive spending that the company made during the year for the advancement of the Timok Project. After having received the necessary permits for the exploration decline from the Serbian authorities, Nevsun Resources plans to initiate building activities in the second quarter of 2018. The CEO of Nevsun, Peter Kukielski, said that both local stakeholders and shareholders of the company will benefit from the Timok Upper Zone Project.
During the year the company has also used funds to improve the ability of Bisha to move more material to the mill. A decline in the yearly production and sales volumes of the red metal also impinged on Nevsun Resources full 2018 economics.
Total assets decreased by 12.3% to approximately $1.09 billion.
Concerning data on production and sales volumes: during 2017 Nevsun Resources sold 175.2 million pounds of zinc in concentrates (+210.6% year over year) on a yearly zinc concentrate production of 210.4 million pounds and sold 14.4 million pounds of copper in concentrates (-75.4% from 2016) on an annual copper concentrate production of 17.5 million pounds.
Nevsun Resources has a recommendation rating of 2.2 out of a total of 5. The average target price of Nevsun Resources is $3.18 per share. This is a mean of six $2.76 to $3.94 per share ranging estimates, a nearly 40% appreciation of the stock.
About Nevsun Resources in 2018, Peter Kukielski highlights the following catalysts: "At Bisha, the metallurgical and mining challenges of 2017 are largely behind us. Bisha is now set to deliver reliable and consistent cash flows for 2018 and beyond."
For 2018, the company expects to produce between 210 million and 240 million of zinc and between 20 million and 30 million of copper.
(Disclosure: I have no positions in any stock mentioned in this article.)
