Coeur Mining (CDE) is a high-cost producer. While it has shown impressive cost-cutting in 2015, it’s still producing at higher costs than many of its peers (SIL) (RING). These higher costs make it highly leveraged to gold and silver prices compared to other low-cost producers such as Barrick Gold (ABX) and Newmont Mining (NEM).
But while Coeur’s high leverage has led to an impressive price run for the stock, many analysts are worried about a potential pullback and profit-taking. They believe that Coeur’s fundamentals may not be supportive of such a huge rally. This is one of the important factors affecting Market sentiment for Coeur.
The Market consensus rating for Coeur Mining stock is a “buy.” Of the ten analysts covering the company, 50% have given the stock a “buy” recommendation, 30% a “sell,” and 20% a “hold.”
The average target price for CDE is $14.20 compared to its current Market price of $15.90. That implies a potential downside of 10.7%. Investors should note that analysts have revised Coeur’s target price by 200% since the start of the year to reflect its high leverage to precious metal prices.
Upgrades and downgrades
After Coeur’s 2Q16 results, several analysts have increased their target prices.
- Raymond James increased Coeur’s target price from $12.25 to $16.50, maintaining its “outperform” rating.
- RBC Capital Markets increased Coeur’s target price from $18 to $19.
- BMO Capital Markets increased Coeur’s target price from $14 to $18 and reiterated its “outperform” rating.