During the past three months we have been keeping records on analysts' price targets for precious metal miners and have been reporting on our findings on a monthly basis. This article presents our offering for silver miners for the month of June reporting the changes in analyst predictions since our last installment. As of the month of June we are starting to report separately on the silver miners and will be providing additional data compared to previous editions. Our latest results for gold mining stocks have been published here.
As in previous articles we are including the following silver miners in our observations: First Majestic Silver (NYSE:AG), Endeavour Silver (NYSE:EXK), Pan American Silver (NASDAQ:PAAS), Hecla Mining (NYSE:HL), Coeur Mining (NYSE:CDE), Fortuna Silver Mines (NYSE:FSM), Silvercorp Metals (NYSEMKT:SVM) and Silver Standard (NASDAQ:SSRI).
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 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 Yahoo.com.
The following columns are colored in light green and contain data given in percentages related to the share price at the time of writing as documented in the third column. 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 May report with the last columns giving the average change over the low, median and high price targets.
We are especially interested in the following three measures documented in the table above:
- Column "median-price" indicates the potential of the stock as far as analyst targets are concerned.
- Column "high-low" measures the divergence in analyst opinions.
- Column "target change average" gives a measurement for the change in targets during the past month.
The results for these three columns for silver miners are visualized in the three diagrams below.
We note that First Majestic Silver is trading the furthest below the median price target indicating the greatest potential closely followed by Endeavour Silver. Hecla Mining is presently trading the closest to the median price target. It is also worth noting that all silver miners in our watch list are trading below the lowest price target provided by analysts.
Disagreement with regards to future prospects is the greatest for Silver Standard for which the high and the low targets differ by 127% measured against the current share price. First Majestic Silver also seems to have analysts puzzled with a target spread of more than 100%. The "high-low target" spread for Silver Standard is almost three times the spread for Silvercorp; incidentally, Silvercorp suffered the greatest target cuts during the past month with Silver Standard coming in with the second-largest cuts. Coeur Mining is the third silver miner that stands out with regards to target cuts. Fortuna Silver's targets have held up best since our last report.
We are signing off this month with a three month chart showing high, low and medium targets for First Majestic Silver along with the share price. Obviously, targets for the company have changed a fair bit recently accounting for turbulent spot price action and volatile market conditions. Remarkably, the median target has held up exceptionally well, only dropping from $23.40 to $22.00 in this turbulent period of time. There are five analysts covering First Majestic Silver.
Disclosure: I am long AG, EXK. 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.