Analyst Downgrades: Barrick Gold Corporation, Kinross Gold Corporation, and Yamana Gold Inc.

Analysts downwardly revised their ratings and price targets on Barrick Gold Corporation (USA) (ABX), Kinross Gold Corporation (USA) (KGC), and Yamana Gold Inc. (USA) (AUY)

by Kirra Fedyszyn

Published on Sep 7, 2016 at 10:03 AM
Updated on Jun 24, 2020 at 10:16 AM

Analysts are weighing in on gold stocks Barrick Gold Corporation (USA) (NYSE:ABX), Kinross Gold Corporation (USA) (NYSE:KGC), and Yamana Gold Inc. (USA) (NYSE:AUY). Here's a quick roundup of today's bearish brokerage notes on ABX, KGC, and AUY.

  • Berenberg initiated coverage on a handful of gold stocks today. For ABX, this resulted in a "sell" rating and $15.20 price target -- a 19% discount to the stock's current level of $18.83, off 1.1% this morning. This move is rather surprising, considering Barrick Gold Corporation has added an astounding 155% year-to-date. Plus, the stock's most recent pullback found a familiar area of support at the $17 level, after last Friday's nonfarm payrolls report gave gold stocks a big boost. However, it echoes the majority, considering only three out of 14 analysts currently rate the stock better than a "hold." Should the stock resume its uptrend, a round of well-deserved upgrades could translate into fresh tailwinds.

  • KGC was given a "hold" rating at Berenberg, which set its price target on the stock at $4.60 -- essentially in line with the equity's current price at $4.59. Credit Suisse also weighed in on KGC, cutting its target price to $5.75 from $6.00. The equity has followed suit with many sector peers in turning in an outstanding year so far, up more than 150%. And near-term options traders have taken a distinctly call-skewed approach, per Kinross Gold Corporation's Schaeffer's put/call open interest ratio (SOIR) of 0.31. This reading shows that calls outnumber puts more than 3-to-1 among options expiring within the next three months, and sits lower than 87% of comparable readings taken in the past year.
  • AUY received a price-target cut to $6.25 from $6.50 -- still in two-year-high territory -- at Credit Suisse. The shares have added roughly 20% so far in September alone, even with today's 0.9% at $4.85. Analysts, meanwhile, have taken an upbeat outlook toward AUY. Nearly two-thirds of the brokerage firms tracking Yamana Gold Inc. give the stock a "buy" or better rating. Options traders have been optimistic, as well. At the ISE, CBOE, and PHLX, the stock's 50-day call/put volume ratio sits at a top-heavy 12.63, meaning speculators have bought to open nearly 13 AUY calls for each put over the last 10 weeks. Moreover, this reading ranks in the high 87th percentile of its annual range.
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