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Capital Limited stock price target cut, retains buy rating

EditorNatashya Angelica
Published 04/18/2024, 01:03 PM

On Thursday, Capital Limited (CAPD:LN), a company specializing in drilling and mining services, saw its price target adjusted by Stifel, a financial services firm. The new stock target is set at £1.45, a slight decrease from the previous £1.50. Despite this adjustment, Stifel has maintained a Buy rating on the stock.

The company recently published its first quarter trading update for 2024, which reported a solid performance amid the initiation of asset mobilization under new contracts. These developments are expected to underpin near-term growth for the company.

Still, Capital Limited experienced a dip in revenue compared to the previous quarter, falling short of Stifel's estimates. The decrease was attributed to a reduction in drilling activities in certain areas and seasonal effects impacting its laboratory business.

Even with the lower revenues, the firm's Average Revenue Per Operating Rig (ARPOR) remained strong, indicating a shift towards higher-quality contracts. This is seen as a positive indicator of the company's strategic focus and operational efficiency.

Looking ahead, Capital Limited has confirmed that its full-year guidance remains unchanged. This projection suggests that the company anticipates significant revenue growth in the upcoming quarters, which could potentially offset the subdued performance observed in the first quarter of 2024.

Investors and market watchers will be keeping an eye on Capital Limited as it continues to navigate the challenges and opportunities in the mining services sector. The company's efforts to secure high-quality contracts and the expectation of revenue growth are key factors that will likely influence its stock performance in the future.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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