Newfield Resources Ltd.: Buy Recommendation from Sphene Capital GmbH

Sphene Capital GmbH has initiated coverage of Newfield Resources Ltd. with a Buy rating. The target price is set at AUD 0.47 per share, indicating potential upside from the current price of AUD 0.14. The valuation is based on the Tongo and Tonguma projects in Sierra Leone, focusing on their high-grade diamond resources.

Newfield Resources, headquartered in Australia, operates in Sierra Leone. The Tongo project spans 134 km² and includes 11 kimberlite dykes. Five of these dykes have an estimated 8.3 million carats of diamonds. The project's net asset value is projected at AUD 2.8 billion.

Despite global market uncertainties, Tongo diamonds, averaging USD 216 per carat, remain in high demand for luxury jewelry. The project is not threatened by lab-grown diamonds, according to Sphene Capital.

A 17-year life of mine is expected at Tongo, with annual production ranging between 350,000-500,000 carats. Peak revenues and EBITDA are projected to reach AUD 347.9 million and AUD 223.0 million, respectively, by 2040/41.