Insights

Why the Western Areas (ASX:WSA) share price is racing higher

Here’s why this miner is charging higher…
The post Why the Western Areas (ASX:WSA) share price is racing higher appeared first on The Motley Fool Australia. –

The Western Areas Ltd (ASX: WSA) share price has been a solid performer on Thursday morning.

In early trade, the nickel producer’s shares are up 4% to $2.55.

Why is the Western Areas share price charging higher?

The solid gain by the Western Areas share price today has been driven by the release of its quarterly production and sales update.

In respect to production, Western Areas reported total nickel in concentration production of 4,622 tonnes for the quarter. This was the strongest three months of FY 2021, resulting in full year production of 16,180 tonnes.

The strong quarterly production result was underpinned by an increase in total milled ore and stronger average recovery rates.

Sales update

The release explains that Western Areas’ June quarter nickel sales were impacted by a timing variance related to the final export shipment leaving port after the end of the financial year.

As a result, the provisional total volume of nickel in concentrate sold for FY 2021 is estimated at 15,500 tonnes, subject to final assay results. The remaining 820 tonnes that missed the year-end deadline will be reported as sales and cash flow in FY 2022. It was also be accounted for as finished goods inventory, rather than revenue for FY 2021.

Is it too late to invest?

One broker that has been very bullish on Western Areas recently in Ord Minnett. And while the broker has yet to respond to this update, it currently has a buy rating and $3.20 price target on the company’s shares.

Based on the current Western Areas share price of $2.55, this implies potential upside of over 25% for its shares over the next 12 months.

Though, investors may want to wait to see what it thinks about this update before acting on its previous recommendation.

The post Why the Western Areas (ASX:WSA) share price is racing higher appeared first on The Motley Fool Australia.

Should you invest $1,000 in Western Areas right now?

Before you consider Western Areas, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Western Areas wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of May 24th 2021

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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