Up 108% in a year, why this buy-rated ASX 300 mining stock is tipped for more outperformance

S&P/ASX 300 Index (ASX: XKO) mining stock Chalice Mining Ltd (ASX: CHN) has been on a tear this past year.

At the time of writing on Thursday, shares are down 3.4% in intraday trade, changing hands for $2.54 apiece.

Despite that retrace, Chalice Mining shares remain up a whopping 108.2% over 12 months, smashing the 5.5% one-year returns delivered by the ASX 300.

And with its flagship critical minerals project nearing potential production, Chalice Mining shares could keep outpacing the benchmark in the year ahead.

ASX 300 mining stock tipped for more gains

UBS analyst Levi Spry sees more upside potential for Chalice Mining, increasing the stock from a neutral to a buy rating (courtesy of The Bull).

Part of that bullish outlook stems from the ASX 300 mining stock’s Gonneville Platinum Group Metal-Nickel-Copper Project, located in Western Australia. The project was discovered by Chalice’s geologists in early 2020.

Chalice Mining notes:

In December 2025, the Pre-Feasibility was completed determining the optimal development pathway for the Project. A long life and globally critical minerals mine in Western Australia, set to generate A$4.7bn in free cashflow pre-tax, with a rapid payback of ~2.7 years.

Amid growing confidence that the project will advance to production, UBS increased its price target on Chalice Mining to $2.75 a share. That represents a potential upside of just over 8% from current levels.

What’s been happening with Chalice Mining?

Chalice Mining shares closed up 22.9% on 17 February last year after the ASX 300 mining stock reported a “major metallurgical breakthrough” at Gonneville.

The company said the breakthrough means the project will not require a hydrometallurgical process for the nickel concentrate, noting this “substantially reduces” technical risk, process complexity, and capital and operating costs.

Commenting on the advancement on the day, Chalice Mining CEO Alex Dorsch said:

The ability to produce a saleable nickel concentrate across the grade spectrum of the entire Gonneville Resource is a major breakthrough and fundamentally simplifies the world-class Gonneville Project. This is the step change we have been hoping for over the last two years.

Dorsch added:

Removing the need for a hydrometallurgical process materially reduces both the capital and operating costs and, together with the optimisations being introduced to the flowsheet, is expected to deliver a significant improvement in project margins across all high-grade and low-grade phases of a bulk open-pit mine plan. The simplified flowsheet also has much lower risk profile and gives the Project a smoother and more rapid pathway to development.

On 20 October, Chalice Mining affirmed that it has targeted the Final Investment Decision (FID) for its Gonneville Project in late calendar year 2027.

The post Up 108% in a year, why this buy-rated ASX 300 mining stock is tipped for more outperformance appeared first on The Motley Fool Australia.

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Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.