Gold Miners Analyst Watch: November Edition

by: Itinerant

Another month has gone and we find ourselves at the start of November providing our update on analysts' price targets for gold miners. As in previous articles of this series we will be noting price targets and target changes in comparison with results published in our last edition a month ago.

We continue to consider the following stocks (in alphabetical order): Agnico Eagle (NYSE:AEM), Alamos Gold (NYSE:AGI), Allied Nevada (NYSEMKT:ANV), AngloGold Ashanti (NYSE:AU), AuRico Gold (NYSE:AUQ), Barrick Gold (NYSE:ABX), Eldorado Gold (NYSE:EGO), Gold Fields (NYSE:GFI), Goldcorp (NYSE:GG), Harmony Gold (NYSE:HMY), IAMGOLD (NYSE:IAG), Kinross Gold (NYSE:KGC), McEwen Mining (NYSE:MUX), New Gold (NYSEMKT:NGD), Newmont Mining (NYSE:NEM), Primero Mining (NYSE:PPP), Randgold (NASDAQ:GOLD), Sibanye Gold (NYSE:SBGL), Yamana Gold (NYSE:AUY).

We have dropped Nevsun Resources (NYSEMKT:NSU) from our gold miners watch list and will be following this company in the base miners edition from now on. The latest edition to our watch list is B2Gold (NYSEMKT:BTG) which will be taking Nevsun's place in the table below.

It is important to note that many companies mentioned in this article may have more analysts following their progress than considered in our data base. This difference is due to the fact that not all analysts release their predictions to which is the sole source of our data. Instead, in many cases analyst data is considered as proprietary information only available to subscribers of the analysts' services.

The table below summarizes our data. The first three columns list the company name, ticker symbol and share price at the time of writing. Price targets (low, median and high) are listed in the following three columns. These targets are followed by a column giving the number of analysts providing data to and the mean recommendation given by these analysts ranging from 1.0 (strong buy) to 5.0 (sell). This concludes the data sourced directly from

The following columns are colored in light green and contain data derived from our source data. These data points are given in percentages related to the share price at the time of writing. The column titled "median-price" gives the difference between the share price and the median target price. The column titled "high-low" gives the difference between the high and the low target. The last four columns titled "target change" document the changes in price targets since the October report with the last columns giving the average change over the low, median and high price targets.

We usually keep an eye on the difference between the current share price and the median price target and interpret this difference as a measurement for the potential of a stock in the eyes of analysts. This value is given in column "median-price" and the diagram below.

McEwen Mining leads in this category on paper, but only has one analyst providing data. B2Gold is the only other stock trading more than 50% of the current share price below the median price target, closely followed by Allied Nevada and New Gold. Sibanye Gold continues to trade significantly above the median price target and we are beginning to wonder if analysts should go back to the drawing board on this particular company.

Column "high-low" measures the divergence in analyst opinions. The results from this column in the table at the top of this article are visualized in the next diagram.

Allied Nevada has taken the lead in this category with analysts obviously unsure whether or not recent issues at the leach pads have been overcome once and for all. Interestingly, price targets for GoldCorp differ enough between analysts to put the largest gold miner by market capitalization into second place. Sibanye Gold and B2Gold have the greatest degree of consensus in the price targets calculated by analysts.

Four companies had their price targets lifted on average since our last snap shot: McEwen Mining, Alamos Gold, Primero Mining and Allied Nevada (by a fraction). Most other companies suffered cuts to the price targets. Gold Fields brings up the rear in this ranking with targets cut by 37% of the current share price. On average targets were cut by 4.5% (yet again) for the observed group of gold miners during the past month.

A visualization for column "Recommendation" concludes our report. The little red bars indicate recommendation changes since last month. B2Gold is held in the highest esteem this time around followed by Primero Mining. Agnico Eagle deserves a mention here as well having received the greatest increase in this rating since last time following a convincing third quarter performance.

Our pick of the month

We are giving the honors to two companies this time:

  • B2Gold for which analysts quite uniformly provide high targets and high recommendations; and
  • Agnico Eagle after a bumper third quarter which is reflected in a much improved analyst recommendation.

Disclosure: I am long AEM. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.