The Regis Resources Limited (ASX: RRL) share price is out of form again on Friday.
In morning trade, the gold miner's shares are down 5% to a 52-week low of $2.05.
Why is the Regis Resources share price under pressure?
Investors have been selling down the Regis Resources share price today after a pullback in the gold price to a one-month low.
According to CNBC, the spot gold price fell 2.3% to US$1,754.10 an ounce during overnight trade. This was driven by improvements in the US dollar and bond yields, reducing the appeal of the precious metal.
It isn't just the Regis Resources share price falling today, though. The weakness in the gold price has led to the S&P/ASX All Ordinaries Gold index falling almost 4%.
Why are its shares at a 52-week low?
While the above explains the weakness in the Regis Resources share price today, it doesn't necessarily explain why it is at a 52-week low.
That appears to be due to uncertainty relating to its McPhillamys Gold Project. This project is one of the largest undeveloped open pit gold projects in Australia and seen as the key driver of the company's future growth.
However, it is still seeking approval and the progress to gaining it has been taking some time. It is largely because of this that the team at Goldman Sachs have a sell rating on its shares.
Last month the broker commented: "McPhillamys approvals and execution risk: the greenfield development project is still awaiting regulatory approval (DPIE and IPC) and a pending DFS update. We see downside risk in the project achieving regulatory approvals given a mixed recent history of mining approvals in NSW. Regardless, we expect that when-and-if the project is approved, the updated DFS will present significantly higher capex and opex estimates than the 2017 PFS. Given the slow progress of approvals, our forecast construction and commissioning timeline assumes plant commissioning late-2023."
Though, it is worth noting that since the release of this note, the Regis Resources share price has tumbled lower. As such, it is now trading well below Goldman's price target of $2.50. This could be a sign that value is now emerging for investors.
