- Barrick Gold (ABX +1.6%) and Randgold Resources (GOLD -1.1%) are upgraded to Buy from Hold and Kinross Gold (KGC +0.1%) is raised to Hold from Underperform at Jefferies, after the firm increases its gold price forecasts to reflect ongoing elevated macro risk.
- Jefferies rates ABX its top mining pick, and believes the company's conversion of debt to equity via free cash flow is a clear positive and will be accelerated at a gold price of at least $1,300/oz.
- At $1,300 gold, the firm thinks KGC looks inexpensive and more than offsets associated risks, which was not the case assuming $1,200/oz. gold.
- Jefferies says GOLD stands out among its U.K. peers with best in class liquidity, quality operations and a premium valuation that should persist as the gold price moves higher into H2.