New Gold Inc. (NGD) stock is surging 5.08% in Tuesday's intraday trading session, following CIBC Capital Markets' decision to raise its price target on the Canadian intermediate gold mining company. The move comes after New Gold reported its second-quarter results before the market opened on July 28.

CIBC analyst Anita Soni increased the price target for New Gold from US$6.25 to US$6.50 while maintaining an Outperformer rating on the stock. Soni noted that the company's Q2 performance beat CIBC's estimates, primarily due to lower operating costs, depreciation, and taxes, which offset lower-than-expected gold production. The analyst highlighted that New Gold achieved a quarterly record in free cash flow, generating $63 million in Q2.

Looking ahead, Soni believes that investor focus will remain on New Gold's free cash flow potential for the second half of the year, which the analyst sees as intact. This positive outlook, combined with the increased price target, appears to be driving investor enthusiasm and contributing to the stock's significant rise today.