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Analyst Actions: Taseko Mines Target Cut at Credit Suisse; Shrs Near Yr Lows

"Taseko Mines Ltd. (TKO) reported adjusted EPS of $0.03, versus our estimate of $0.07 and consensus of $0.07. We estimate that the miss was due to higher than expected production costs, as well as a missed shipment of 3.9Mlb that will be accounted for in Q3."

Taseko shares have touched a day low of $3.38, close to a year low $3.30.

"TKO reported Q2 production of 20.0 million pounds of copper on July 11th, 2011. We note that this is a 4% improvement versus the previous quarter, with tonnage improving 16% QoQ offset by an 11% decline in grades. Cash costs continue to trend upward to $2.32 per pound of copper on a by-product basis, above our estimate of $1.80 per pound, driven by a higher strip ratio, a stronger C$, higher consumable costs and unscheduled maintenance."

GDP3 progress commentary. "Taseko's GDP3 expansion project at Gibraltar continues to progress, with the $237 million EPCM being awarded and the detailed engineering and procurement currently in focus. TKO's 25% joint venture partner in Gibraltar, Cariboo Copper Corp., has not yet given its consent for the expansion, although Cariboo has stated that subject to various conditions, it does not intend to prevent TKO from proceeding with GDP3."

"We model 85Mlb of copper production for 2011, at cash costs of $2.15/lb. We model 46 Mlb of copper production in 2H2011, as throughput continues to ramp up to 55ktpd. We expect this 55ktpd rate to be maintained through 2012, resulting in 105Mlb of copper production at cash costs of $1.83/lb."

"We are lowering our 2011/2012/2013 EPS estimates to C$0.26/C$0.48/C$0.48 from C$0.31/C$0.50/C$0.49 respectively. We continue to rate TKO 'Underperform', with a target price of C$4.50 previously C$4.75). Our target price continues to be based on a 70/30 weighting of 1.0x our NAVPS of C$4.32 (previously C$4.50), and 5.0x our FY12 EBITDA."

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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