Market sentiment for Coeur Mining
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). Another factor that’s impacting the sentiment for the stock is its recent plan to issue additional equity.
The market consensus rating for Coeur Mining stock is split between “buy” and “hold.” Of the nine analysts covering the company, 56% have “buy” recommendations, and 44% have recommended a “hold.”
The average target price for CDE is $15.40 compared to its current market price of $11. That implies a potential upside of 40%. You should note that analysts have revised Coeur’s target price by 225% since the start of the year to reflect its high leverage to precious metal prices.
On October 3, 2016, Deutsche Bank (DB) upgraded Coeur Mining from “sell” to “hold.” The firm also increased its target price from $7.50 to $11.
CIBC (Canadian Imperial Bank of Commerce) also lifted Coeur stock from “sector underperform” to “sector perform” on August 29, 2016. According to CIBC analyst Cosmos Chiu, “The thesis for the Coeur Mining story has changed.” Its falling cost profile and strengthening balance sheet should benefit the stock going forward. CIBC also raised the stock’s target price from $9.50 to $14.50.
In May 2016, BMO Capital Markets Equity Research upgraded Coeur Mining to “outperform” from “market perform.” In the same report, it also upgraded Yamana Gold (AUY), Silver Wheaton (SLW), Pan American Silver (PAAS), and Detour Gold (DRGDF).
Analysts also commented on Coeur Mining after its 3Q16 production results, but they’ve maintained their ratings.