UPDATE: Dundee Upgrades Agnico-Eagle Mines

On Thursday, Dundee upgraded shares of Agnico-Eagle Mines AEM from Neutral to Buy and lowered the price target from C$42 to C$40 or from $38.09 to $36.28. Analyst Josh Wolfson's upgrade is based on:

• Low expected returns and modest identified opportunities for upside.
• Tempered enthusiasm regarding the financial merits of acquiring Malartic.
• Agnico's financial outlook has “improved.”

Wolfson's analysis indicates an acquisition of Malartic would provide “a modest positive impact, but the expected return on capital issued of $1.66B is low.” “Pre-released 1Q operating results suggest operating momentum beyond strong Meadowbank results, and we now have greater conviction Agnico may seek to increase its guidance over the next 1-2 quarters,” said the analyst. The stock is down 0.6 percent to $28.31 in Thursday's trading.