Analyst Heiko Ihle of H.C. Wainwright reiterated a Buy rating on Westwater Resources, reducing the price target to $1.75.
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Heiko Ihle has given his Buy rating due to a combination of factors related to Westwater Resources’ strategic initiatives and financial positioning. The company is actively aligning its Kellyton Graphite Plant’s processing capacity with current commitments and financing, aiming to reduce capital costs while accelerating production timelines. This strategic approach is seen as a mature response to the increasing demand for battery-grade natural graphite, as the company adjusts its operations to match existing demand levels.
Additionally, Westwater’s progress on the permitting process for its Coosa Graphite Deposit is noteworthy. The site benefits from favorable permitting conditions and logistical advantages, and the company is working with engineering firms and government agencies to facilitate this process. The vertically integrated U.S.-based graphite supply chain, once operational, is expected to play a significant role in restoring domestic critical mineral supply chains. Despite a slight decrease in the price target due to share dilution, the valuation remains robust, supported by a comprehensive discounted cash flow analysis and a favorable discount rate that reflects the asset’s unique geopolitical risk factors.