A Look at West African Resources (ASX:WAF) Valuation After Government Seeks Larger Kiaka Stake and Trading Suspension

West African Resources (ASX:WAF) shares were suspended from trading on the ASX after the Burkinabe government proposed boosting its stake in the Kiaka project from 10% to 50%. This development comes as the company announced its first gold pour at Kiaka ahead of schedule and under budget, putting both operational progress and political risk in sharp focus for investors.

See our latest analysis for West African Resources.

The political uncertainty surrounding the Kiaka stake hike took center stage just as West African Resources achieved its first gold pour at the site, adding momentum to investor interest. While the market reaction has been cautious, the company’s solid operational performance suggests growing long-term potential even as short-term headwinds persist, reflected in a 1-year total shareholder return of nearly 0.83% and a share price now at $3.04.

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With the company posting robust growth figures and trading at a modest discount to analyst price targets, investors may wonder whether West African Resources is undervalued after recent developments or if future upside is fully priced in.

Most Popular Narrative: 15.6% Undervalued

West African Resources closed at A$3.04, notably below the narrative’s fair value of A$3.60. This gap draws attention to the future growth drivers that could shape the company’s next phase.

The successful commissioning and ramp-up of the Kiaka Gold Project, with first gold poured ahead of schedule and under budget, positions West African Resources for a material production increase in 2025 and beyond. This is expected to boost revenue and deliver significant operating leverage as fixed costs are absorbed over higher output.

Read the complete narrative.

Want to know the creative accounting that fuels this optimistic outcome? The forecast leans on ambitious revenue growth, shrinking margins, and a profit forecast that stirs debate among analysts. Discover which numbers are driving this punchy price target. Read on to unlock the real story that could move this stock.

Result: Fair Value of $3.60 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, any prolonged reliance on expensive power sources or further government delays could quickly squeeze margins and reduce the positive outlook for the shares.

Find out about the key risks to this West African Resources narrative.

Build Your Own West African Resources Narrative

If these conclusions don't quite match your perspective, why not dig into the numbers yourself and craft your own view in just a few minutes, all in Do it your way.

A great starting point for your West African Resources research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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