HSBC cuts its 2014 price target for gold to $1,292/oz. from $1,435 and its 2015 forecast to $1,310 from $1,395, downgrading Barrick Gold (ABX -2.1%), Yamana Gold (AUY -2.6%) and African Barrick Gold (ABGLF, ABGLY) in the process.
ABX may benefit this year from new mine plans which could radically improve near term cash flow, but this likely will come at the expense of reserves and mine life, the firm says in cutting shares to Underweight with a $16.50 price target (from $19.60).
AUY enjoys low average costs but the firm believes this is more than factored in, and cites the relatively small production base and concerns about long-term sustainability of profitability at El Penon in lowering shares to Underweight with an $8.20 target (from $9.60).
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