Gold Miners: The Latest Must-Read Wall Street Ratings
Expectations reset for Coeur Mining
On April 8, CIBC downgraded Coeur Mining from a “sector perform” rating to a “sector underperform” rating. On the same day, CIBC also downgraded Hecla Mining (HL) to “sector perform” from “sector outperform.” Pan American Silver (PAAS), on the other hand, saw an upgrade to “sector outperform” from CIBC. Sandstorm Gold (SAND) also saw an upgrade from CIBC.
On March 23, Deutsche Bank (DB) also downgraded Coeur Mining from a “hold” to a “sell” rating. Its price target for the company is $3.40.
In the last month, Coeur Mining has seen two downgrades. Following its recent strong run-up, many analysts are pulling back their expectations.
Tahoe Resources to trade at a premium?
Tahoe Resources (TAHO) has emerged as an analyst favorite with no “sell” ratings and 87% “buy” ratings. RBC increased its price target for Tahoe from $13 CAD to $15 CAD on April 10.
Canaccord Genuity also revised its target price upwards from $15 CAD to $18 CAD on April 5. According to the analyst, Tahoe “should trade at a premium valuation multiple to its peer.” Regarding Tahoe’s recent business combination with Lake Shore Gold, the analyst further added, “Overall, we view the transaction as neutral on a NAVPS basis and positive on earnings (16 per cent) and cash flows (4 per cent). The key benefit is that the deal further diversifies Tahoe’s perceived geopolitical risk and moreover provides for significant optimization and exploration potential, which may be detailed in the coming months.”
First Majestic Silver
Desjardins Securities downgraded First Majestic Silver (AG) to a “sell” rating from a “hold” on March 31. This change was, however, accompanied by an increase in the target price from $4.75 CAD to $7.25 CAD due to revised metal prices and currency assumptions. Desjardins isn’t happy with First Majestic Silver’s reserve and resource update, which resulted in reserves falling 13%.
On March 14, BMO Capital Markets also downgraded First Majestic from a “market perform” rating to an “underperform” rating. However, BMO increased its target price from $5.00 to $5.50.
Pan American Silver
RBC Capital increased PAAS’s target price by 50% from $8 to $12 on April 10 while maintaining its “sector perform” rating.
Credit Suisse (CS) increased Pan American Silver’s (PAAS) target price from $11.50 CAD to $13.50 CAD.
ScotiaBank cut Hecla Mining (HL) from “sector perform” to “underperform” on April 11.
RBC, on the other hand, increased Hecla’s target price from $2.50 to $3.25 while maintaining a “sector perform” rating.
Gold miners (GDX) will release their earnings in the next few weeks. Before that, we’ll publish an earnings preview to discuss what’s expected from these companies for the quarter. For previews and the latest updates on the precious metals sector, be sure to watch Market Realist’s Precious Metals Mining page.
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