Caledonia Mining rose about 6 percent today, marking a sharp breakout that has pushed the stock up 16 percent this week alone. We think this is mostly a late reaction to recent news that gold production jumped 18 percent and a new gold zone was discovered at its primary mine.
Our view
The company is successfully using cash from its main mine to fund a much larger expansion, and the recent jump in production shows that plan is working. If you already own it, there is nothing to do here but sit tight and let the growth play out.
Exploration at the Blanket Mine in Zimbabwe has uncovered a new area of gold mineralization near the surface. This discovery, called the K-Pits target, contains both oxide and sulphide gold, which are different types of ore that require different processing methods.
This is important because near-surface gold can often be mined using heap leaching, a process that uses chemicals to dissolve gold from ore and is typically much cheaper than traditional underground mining. If this zone proves large enough, it could provide a low-cost boost to production alongside the company's existing deep-level operations.
Company newsPositive
Jul 20
Gold production rose 18 percent in the second quarter
Gold production at the Blanket Mine increased significantly compared to the first quarter of the year. The company produced 17,360 ounces, an 18 percent jump that management attributes to better access to higher-grade ore, which is rock that contains a higher concentration of gold.
Caledonia is maintaining its full-year production targets. This steady performance at its main mine is critical because it provides the cash the company needs to fund its larger expansion projects elsewhere in Zimbabwe.
Caledonia Mining analyst price targets
Analysts have maintained a positive outlook on the stock despite no recent flurry of activity. Both experts rate it a buy, but the average target of $17 is about 21% below the current price.
Average target$17.25-21%vs $21.75 today
TodayAvg price
Low $13.50High $21
Strong Buy2 analysts
0Bearish
0Neutral
2Bullish
FirmRatingPrice TargetDate
Maxim Group
Buy
$18→$21
5/14/2025
Cantor Fitzgerald
Speculative Buy
$13.50
4/29/2024
Caledonia Mining earnings
The company has a habit of clearing the bars set by analysts, beating earnings estimates in four of the last seven quarters while growing revenue 18 percent.
Earnings history
EstimateBeatMiss
Caledonia Mining past earnings results
Expected
Actual
Surprise
EPS
$0.67
$0.80
+19.4%
Revenue
$79M
$66M
-16.1%
Key highlights
Gold price drives profit: Profit after tax grew 69.4% to $18.91 million as a much higher gold price more than made up for a 20.9% drop in gold production. The company sold its gold for an average price of $4,816 per ounce compared to $2,896 a year ago, which protected the bottom line even while operations slowed.
Access issues raise costs: All in sustaining costs, a measure of what it costs to produce and sell gold, rose to $2,765 per ounce from $1,797 a year ago. This was mainly because the company had trouble reaching higher-grade ore areas, which meant it mined lower-quality rock and had fewer total ounces to spread its fixed costs across.
Production outlook steady: Management expects production at the Blanket Mine to be between 72,000 and 76,500 ounces for the full year. The company is confident in this range because gold quality improved month-over-month during the quarter and it is adding a new contractor and extra shifts to speed up work.
Bilboes project funding: The company raised $150 million in January 2026 through convertible notes, which are loans that can turn into stock, to help fund its new Bilboes mine. This project is expected to eventually increase the company's total gold production by roughly four times at much lower costs than it has today.
Exploration confirms depth: Deep-level drilling covered 10,312 metres and confirmed that gold deposits continue deep underground below current mining levels. These results give the company more certainty that the Blanket Mine can continue producing for many years beyond its current schedule.
Our take: This was a strong quarter that relied more on a surging gold price than on operational efficiency. While production issues at the Blanket Mine pushed costs higher, the company is successfully securing the $484 million needed to build its transformational Bilboes project. The long-term growth story remains intact as these investments prepare to significantly scale output.
Caledonia Mining’s next earnings date
Q2 2026
AUG
10
Expectation
EPS
$0.54
Revenue
$82M
Metrics we are tracking
Metric
Expectations
Status
Gold Production
Staying above 75,000 ounces annually at Blanket Mine
14,767 ounces in Q1 2026
AISC
Keeping all-in sustaining costs below $1,750 per ounce
$2,765 per ounce in Q1 2026
Bilboes Milestone
Completing the full feasibility study by mid-2025
Feasibility study completed Nov 2025
Dividend Payout
Maintaining the quarterly dividend of $0.14 per share
$0.14 per share in Q1 2026
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