Pan African Resources continues to grow amidst high gold price surges

Pan African Resources PLC is a mid-tier African-focused gold producer with a production capacity in excess of 200,000oz of gold per annum.

The company owns and operate a portfolio of high-quality, low-cost operations and projects, which are located in South Africa.

RBC Capital Markets has started its coverage of Pan African Resources PLC (LSE:PAF, OTCQX:PAFRY, JSE:PAN) with an Outperform rating and a 155p price target that implies upside of 55%.

The broker expects production to rise about 30% to 350,000 ounces annually by FY30, led by Tennant Creek in Australia, which it sees reaching around 100,000 ounces. EBITDA is forecast to climb to $1.2 billion by FY29.

London-based analysts for the Canadian bank, in a note, highlighted that Pan African has been transformed into a diversified mid-cap producer with a path to 350,000 ounces of annual production by FY30, while EBITDA is forecast to rise to around $1.2 billion by FY29.

Australia is central to that growth story. RBC expects Tennant Creek to ramp from roughly 34,000 ounces currently to around 100,000 ounces annually by FY29/30, ultimately contributing about 27% of group production and EBITDA.

Mining stocks dominated the FTSE 350 risers on Thursday as stronger metals prices boosted sentiment across the sector.

Precious metals miners led the way, with Pan African Resources PLC (LSE:PAF, OTCQX:PAFRY) rising 4.7%,followed by Hochschild Mining PLC (LSE:HOC, OTCQX:HCHDF), which gained 3.9%, while Atalaya Mining Copper (LSE:ATYM, TSX:AYM), Endeavour Mining PLC (LSE:EDV, OTCQX:EDVMF) and Fresnillo PLC (LSE:FRES) all up over 2%. 

Pan African Resources PLC (LSE:PAF, OTCQX:PAFRY, JSE:PAN) told investors it expects to deliver record annual gold production for the year to 30 June 2026, with output forecast to rise by around 40% to approximately 275,000 ounces.

The figure is in line with the lower end of the group’s FY26 guidance range of 275,000 to 292,000 ounces, compared with 196,527 ounces in FY25. Second-half production is expected to reach 147,000 ounces, around 14% higher than the 128,296 ounces produced in the first half.

Shore Capital has told clients it is time to buy back into Pan African Resources PLC (LSE:PAF, OTCQX:PAFRY, JSE:PAN), arguing that a brutal sell-off in the gold miner's shares has run well ahead of the fall in the metal itself.

The broker has kept its buy rating and 185p price target on the AIM-listed producer, implying 94% upside from the current 95p.

That gap exists because Pan African's shares have dropped below 100p, down 48% since 2 March.