This report is an updated version of the report published on 29 November 2023 at 4:24 PM AEDT.

Northern Star Resources Ltd (ASX: NST) – SELL at AUD 12.655

Northern Star Resources Ltd is involved in the exploration, development, mining, and processing of gold deposits.

Recommendation Rationale – SELL at AUD 12.655

• Profit Booking: NST’s stock price has breached the ‘Resistance 1’ level given in the report on 14 November 2023, and presented a profit booking opportunity.
• Technical Indicator: The momentum oscillator 14-Day RSI (~63.66) is approaching the overbought zone; and thus, price can face correction in the short term.
• Overvalued Multiples: On a 12–month forward basis – key trading multiples (EV/Sales, EV/EBITDA, Price/Earnings, Price/Cash Flow and Price/Book) are higher than the median of the Basic Materials sector.
• Cash Flow Decline: During FY23, operating cash flow declined by 17% YoY.

NST Daily Chart

 (Source: REFINITIV, Analysis by Kalkine Group)

Valuation Methodology: Price/Earnings Approach (FY24E) (Illustrative)

Considering that the resistance level, and risks associated, it is prudent to book profit at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the current price of AUD 12.655 (as of 29 November 2023, at 3:49 PM AEDT).

Note: This report may be updated with details around fundamental and technical analysis, price/ chart in due course, as appropriate.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 29 November 2023. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Dividend Yield may vary as per the stock price movement. 

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.

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