Sell Goldcorp, Deutsche Bank Says
Deutsche Bank's Jorge Beristain downgraded the rating for Goldcorp Inc. (USA) (NYSE: GG) from Hold to Sell, while reducing the price target from $15 to $13.50.
Goldcorp reported 4Q15 adjusted diluted EPS of $0.01 and a headline loss of $5.14 per share, which was impacted by a $3.9 billion after-tax impairment charge and forex adjustments, inventory write downs and equity losses worth $0.46 per share.
While the EBITDA at $350 million was largely in-line with expectations, cash costs of $687/oz were higher due to lower byproduct credits and weaker results at Los Filos and Procupine. The company's net debt remained flat q/q at $2.4 billion.
Analyst Jorge Beristain noted that production at Pueblo Viejo was impacted by autoclave setbacks, which were resolved in January. Goldcorp reduced its 2016 production guidance from flat [3.45 million recorded in 2015] to 2.8 million-3.1 million oz due to setbacks in Cochenour and Eleonore.
The company's 2015 gold reserves declined 18 percent to 40.7 million oz implying a 13 year reserve life. "At Los Filos, 5.3m oz reserves were removed and production reduced in 2016 under a revised mine plan. Éléonore ramp issues continue and Cochenour production delayed indefinitely," Beristain wrote.
Latest Ratings for GG
|Oct 2016||Canaccord Genuity||Upgrades||Hold||Buy|
|Oct 2016||Deutsche Bank||Upgrades||Sell||Hold|
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