The Investment Doctor
Thu, Jul. 28, 7:21 AM
Thu, May 12, 7:19 PM
- BMO Capital becomes more bullish on precious metals, as it upgrades six gold and silver stocks including five to buy ratings.
- The 20% YTD rise in gold and silver prices should continue over the medium term, the firm says, lending to price targets of $1,400/oz. for gold and $22.50/oz. for silver by the end of Q1 2017.
- BMO upgrades Yamana Gold (NYSE:AUY), Silver Wheaton (NYSE:SLW), Coeur Mining (NYSE:CDE), Pan American Silver (NASDAQ:PAAS) and Detour Gold (OTCPK:DRGDF) to Outperform from Market Perform, and hikes Oceana Gold (OTCPK:OCANF) to Market Perform from Underperform; price targets are $5.50 for AUY (raised from $1), $24 for SLW (jumping from $4.50), $11 for CDE (up from $3), and $19 for PAAS (from $7.50).
- However, the firm downgrades Agnico-Eagle Mines (NYSE:AEM), Franco-Nevada (NYSE:FNV) and Fortuna Silver (NYSE:FSM) to Market Perform from Outperform, saying their stocks already have factored in higher gold and silver prices.
Wed, Apr. 27, 5:42 PM
Thu, Mar. 10, 5:49 PM
Jun. 17, 2015, 12:59 PM
- Goldcorp (GG -0.6%) may be using the ~$950M in proceeds from selling its 25% stake in Tahoe Resources (TAHO +0.5%) to clean up its balance sheet, but the move sparks analyst concern about a potential major acquisition.
- The TAHO sale will dramatically reduce GG's cash needs, yet GG last week announced it expanded its unsecured line of credit to $3B from $2B; Canaccord analyst Tony Lesiak questions the need for the line of credit increase, and that GG "needs to focus on execution and on the significant organic growth project pipeline and exploration potential already in the company."
- TD Securities' Greg Barnes considers Detour Gold's (OTCPK:DRGDF) Detour Lake one of the few operating assets that would fit with GG’s asset portfolio but thinks talk of a major acquisition is premature, with GG trading near 52-week lows and two new projects still in the production ramp-up phase.
Jun. 4, 2015, 11:59 AM
- Detour Gold (OTCPK:DRGDF +1.8%) is higher after releasing an operational update for its flagship Detour Lake gold mine, saying Q2 gold production is expected to come in within guidance of 110K-120K oz.
- Detour says mill throughput rates averaged 59,370 tons/day over last three months, exceeding design capacity of 55K tons/day, and mining rates averaged 271K tons/day over last three months, exceeding the annual budget rate of 238K tons/day.
- Raymond James calls Detour’s update “overwhelmingly positive.”
Apr. 10, 2015, 4:58 PM
- Credit Suisse sees potential for a near-term rally in gold prices, and expects copper prices to do well this year.
- The firm upgrades First Quantum Minerals (OTCPK:FQVLF) to Outperform from Neutral on positive copper and stock re-rating catalysts in H2 2015, and likes HudBay Minerals (NYSE:HBM) and Tahoe Resources (NYSE:TAHO); it downgrades Teck Resources (NYSE:TCK) to Neutral from Outperform based on a weaker outlook for coking coal and valuation.
- Among gold miners, CS prefers Agnico Eagle Mines (NYSE:AEM) for its lower cost assets, operational consistency, strong free cash flow and organic exploration and growth opportunities, and Goldcorp (NYSE:GG) for its growth and relatively strong balance sheet; Yamana Gold (NYSE:AUY) and Detour Gold (OTCPK:DRGDF) provide leverage to a gold price rally.
Apr. 10, 2015, 10:59 AM
- AuRico Gold (AUQ +2.7%) is upgraded to Buy from Hold with a $5 price target at Canaccord, expect its underperforming shares to recover over the next few quarters thanks to an expected strong performance at its flagship Young-Davidson mine.
- The firm says the YTD underperformance is partly explained by the reserve writedown and asset impairment charge recorded at El Chanate, but adds that the market may have overreacted in light of El Chanate's contribution to AUQ.
- At the same time, Canaccord downgrades Detour Gold (OTCPK:DRGDF) to Hold from Buy with a C$13.50 price target, down from C$15, citing lower assumed gold prices and recent outperformance by the shares, while adding that there could be upside to Detour's shares if gold prices were to rise significantly.
Dec. 9, 2014, 5:58 PM
- Energy stocks dominate Raymond James' new list of top picks among Canadian smallcaps, led by Denison Mines (NYSEMKT:DNN), which the firm sees surging ~70% in the next 12 months.
- DNN is viewed as one of the world's premier uranium companies, "a well-run company in a strong position to capitalize on likely significant appreciation in both the underlying commodity price and sector sentiment in 2015."
- The firm also likes Gildan Activewar (NYSE:GIL), which has changed pricing and accelerated its capex program in response to volatile cotton prices in the last year.
- Other favorites include OTCPK:DRGDF, OTCPK:LUNMF, OTCPK:MEGEF, MEOH.
Jun. 6, 2014, 11:22 AM
- Detour Gold (DRGDF) is upgraded to Strong Buy from Outperform with a $16 price target, up from $14, at Raymond James, which cites continued progress in the ramp-up of its flagship Detour Lake mine and in anticipation of stronger operational performance.
- Detour's volatility will diminish over the course of the next year as the miner re-rates to mid-tier producer status, the firm says, and improving cash flow generation is shifting the risk/reward profile in favor of investors.
Jan. 2, 2014, 10:33 AM
- Detour Gold (DRGDF +8.5%) says the processing plant at its Detour Lake mine is expected to resume operations today and is targeted to operate at a rate of 50K metric tons/day within a week.
- The processing plant was shut down Dec. 17 due to mechanical issues; repairs to the pre-leach thickener system have been successfully completed and re-commissioning of the system has commenced.
Dec. 11, 2013, 2:42 PM
- Gold producers' balance sheets appear relatively stable with gold prices at ~$1,250/oz. but would weaken further on lower prices, TD Securities says in an analysis of miners' sensitivity to changes in gold prices.
- At $1,100/oz, companies with the highest forecast ratio of net debt to total capitalization include Barrick Gold (ABX -2.5%), Newmont Mining (NEM -1.9%), Agnico Eagle Mines (AEM -2.5%) and Detour Gold (DRGDF +3.3%).
- TD's top picks include Eldorado (EGO -3.1%), Goldcorp (GG -1.5%), B2Gold (BTG -3.7%), Primero Mining (PPP -0.6%) and Silver Wheaton (SLW -2%).
- ETFs: GDX, GDXJ, NUGT, DUST, GLDX, GGGG, RING, PSAU, JNUG, JDST.
Nov. 25, 2013, 12:37 PM
- The surprise resignation of founder and CEO Gerald Panneton has sent Detour Gold (DRGDF -30.4%) tumbling. He's been replaced on an interim basis by CFO Paul Martin.
- Martin: “It would be fair to say that none of us are satisfied with the share performance. What we need to do is to deliver on our operating parameters to improve that situation.”
- RBC's Dan Rollins expects the company to move quickly to boost capital, but Martin says there's currently no thought of an equity raise.
Jul. 11, 2013, 11:23 AM
"We can get through this with no problem," Detour Gold (DRGDF.PK +5.4%) CEO Gerald Panneton says of $1,250 gold and a YTD 65% drop in the share price. The cause for optimism is the company's Detour Lake mine in Ontario, expected to be the largest gold mine in Canada; it's gradually ramping up, producing ~58K oz. of gold in Q2 and on track to reach commercial production in Q3.| Jul. 11, 2013, 11:23 AM
May 9, 2013, 10:51 AM
Those wanting exposure to gold producers must pay close attention to both cash costs and balance sheets if they want to avoid ugly surprises, Clarus analyst Jamie Spratt says, suggesting a core holding of low-leverage names with longer-term upside, as they generally can fund their growth internally with relatively stronger free cash flow: ABX, IAG, BAA, OSKFF.PK, DRGDF.PK.| May 9, 2013, 10:51 AM
Apr. 16, 2013, 11:58 AM
Analysts at RBC Capital think credit downgrades for some top gold miners are a strong possibility. There's a “moderate probability” Barrick Gold (ABX -0.1%) could trigger a one-notch downgrade at $1,400 gold; at $1,300, Newmont Mining (NEM +1.9%) could get downgraded, and Kinross Gold (KGC +1.8%) could get cut right to junk status. TD Securities also offers similarly disturbing conclusions. (also)| Apr. 16, 2013, 11:58 AM | 5 Comments