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Silver Miners in 2017: Gauging Market Sentiment

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Market sentiment

So far in this series, we’ve analyzed silver miners’ key operating and financial metrics. In this part, we’ll look at the market sentiment toward these companies. We’ll also look at analysts’ recommendations, target prices, and potential upsides for silver miners (SIL).

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Analysts’ favorite

Among all primary silver producers (SIL), Tahoe Resources (TAHO) seems to be the most-liked silver miner. It has 81.0% “buy” ratings and 19.0% “hold” ratings. Its current target price is $15.40, which implies an upside potential of 53.0%.

Silver miners’ ratings

According to 67% of analysts, Coeur Mining (CDE) is a “buy.” Of the nine analysts covering the company, 33% have “hold” recommendations. On October 3, 2016, Deutsche Bank (DB) upgraded Coeur Mining from a “sell” to a “hold.” It also increased Coeur’s target price from $7.50 to $11.

Notably, 70% of analysts have given Hecla Mining (HL) “hold” recommendations, while 20% have issued “buy” recommendations. One year back, Hecla had a “buy” rating from 30% of analysts. Rodman & Renshaw initiated coverage on Hecla with a “buy” recommendation and a target price of $9 in September 2016.

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According to Benzinga, Rodman & Renshaw analyst Heiko F. Ihle stated that “We support Hecla’s strategy of focusing on assets in politically safe jurisdictions such as the United States, Canada, and Mexico and like the fact that the firm’s assets produce a wide array of metals, which provides revenue diversification.”

In comparison, 50% of analysts rate First Majestic Silver (AG) a “hold,” while 50% rate it a “buy.” The stock has “sell” ratings from 33% of analysts. Its target price implies an upside of 106%.

We also should note that while 70% of analysts have “buy” ratings on Pan American Silver (PAAS), 30% have issued “hold” ratings. Pan American Silver’s strong 2016 results, along with its share price strength so far this year, have motivated analysts to upgrade the stock. One year ago, it had no “buy” ratings and 91% “hold” ratings. Next, we’ll look at silver’s fundamental valuation and see if there is a potential upside or downside.

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