Gold Fields initiated Buy at Citi as 'production growth story'

[Gold mine head gear and production plant, South Africa]
bucky_za/E+ via Getty Images

Gold Fields (NYSE:GFI [https://seekingalpha.com/symbol/GFI]) +2.7% in Tuesday's trading, rebounding from the previous session's 6.8% drop, as Citi initiated coverage with a Buy rating and $50 price target, seeing the company as a "production growth story" that has acquired or developed several projects in the past 3-5 years that should result in production increases of ~25% by 2026 and ~33% over the next five years compared to 2024 levels.

The incremental production over the next five years likely will be at lower costs, Citi's Ephrem Ravi wrote, as both the Salares Norte and Windfall projects have lower AISC as guided by the company compared to Gold Fields' (NYSE:GFI [https://seekingalpha.com/symbol/GFI]) current AISC, and the two assets should account for ~30% of the company's overall production in the next 2-5 years, which should result in lower AISC for the company over the next five years.

Relatively shorter mine life might raise some concerns among investors, as most of Gold Fields' (NYSE:GFI [https://seekingalpha.com/symbol/GFI]) current producing mines have a life of mine of ~10 years, but Ravi said Citi's analysis of the company's reserves/resources suggests it has been continuously adding reserves through exploration, which suggests that lower RLI is not a major concern.

More than any other factor, Gold Fields' (GFI [https://seekingalpha.com/symbol/GFI]) share price likely will be determined by the gold
price, as Ravi noted the stock has had an 85% R-squared to the gold price since January 2019.

MORE ON GOLD FIELDS

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* Gold Fields: Record Gold Prices Aren't The Only Catalyst, Excellent To Buy On Dips [https://seekingalpha.com/article/4824636-gold-fields-record-gold-prices-arent-the-only-catalyst-excellent-to-buy-on-dips]
* Gold Fields Presents at Mining Forum Americas 2025 - Slideshow [https://seekingalpha.com/article/4823613-gold-fields-limited-gfi-presents-at-mining-forum-americas-2025-slideshow]