UBS: Golden Star Still a 'Buy' Despite Lowered EPS Estimates

UBS has maintained its buy advice for Golden Star Resources Ltd. (GSS) following the company’s improved fourth quarter operating results, Tony Lesiak, an analyst at UBS said.

The Canadian gold miner, which is based in Denver, Colorado, posted a 25% rise in production from the previous quarter and a 15% decline in cash costs. Golden Star forecasts its production to rise 50% to 73% in 2008, with UBS expecting results to come in at the lower end of the guidance.

Mr. Lesiak said:

GSS also provided cash cost estimates that were significantly more conservative, and to reflect this, we have lowered our 2008 EPS (earnings per share) from C$0.20 to C$0.14 and our 2009 EPS from C$0.33 to C$0.26. Mr. Lesiak said.

He said UBS has maintained its $6 a share target.

Through Monday afternoon trading, Golden Star was down more than 9%, on the Toronto Stock Exchange.