Keeping a Tab on Rating Changes in Senior Gold Mining

Anuradha Garg - Author

Dec. 4 2020, Updated 10:51 a.m. ET

Berenberg upgrades Barrick

Berenberg upgraded Barrick Gold (ABX) from “sell” to “hold” on June 29, 2017. The firm’s analyst, Yuriy Vlasov, believes that most of the downside has already been priced into the stock.

Vlasov also noted that recent developments at Barrick, such as the divestments of the Cerro Casale and Veladero mines, in addition to its deleveraging and strong free cash flow generation, “give us some optimism.” The firm increased its target price for ABX’s stock from $15.2 to $16.4.

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BMO Capital Markets, on the other hand, downgraded Barrick from “outperform” to “market perform” on July 6, 2017, pending the latter’s subsidiary’s conflict with the Tanzanian government. BMO analyst Andrew Kaip noted that Barrick’s shares were trading above those of peers (GDXJ) (GDX), with a risk on the downside. BMO reduced Barrick’s stock price from $21 to $18.

Raymond James initiates on Newmont

Raymond James initiated coverage of Newmont Mining (NEM) with an “outperform” rating in June 2017. The firm believes that the company is a strong opportunity in the gold space.

Raymond analyst Brian MacArthur is positive about the company’s jurisdictional exposure, balance sheet, and cash position. Among other miners (SGDM), Raymond James also likes Alamos Gold (AGI), Agnico Eagle Mines (AEM), Kinross Gold (KGC), and Detour Gold (DRGDF).

Changes for other senior gold miners

Macquarie upgraded Goldcorp (GG) from “neutral” to “outperform” on July 12, 2017. Jefferies cut its 2017 EPS (earnings per share) estimates for Goldcorp from $0.51 to $0.50. The firm also issued its 2018 and 2019 EPS at $0.60 and $0.83, respectively.

CIBC (Canadian Imperial Bank of Commerce) upgraded Kinross Gold (KGC) from a “neutral” rating to an “outperform” rating in May 2017. The firm set a price target of 4.75 Canadian dollars on the stock.

BMO upgraded Kinross from “market perform” to “buy” in May 2017. The firm has also increased Kinross’s target price from $3.75 to $5.00. BMO’s analyst believes that the company’s steady stage of execution and its relative valuation are both attractive.


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