Market Overview

JPMorgan Places Overweight Rating On Hecla Following New Business Acquisitions

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Hecla Mining Company (NYSE: HL) recently acquired new mining initiatives in hopes to increase production and growth opportunities.

The Analysts

JPMorgan analyst John Bridges moved Hecla stock to an Overweight rating, with a price target of $5.50.

The Thesis

Bridges outlined some key reasons for his rating in a Tuesday note.

Hecla just purchased Klondex’s mines in Nevada, giving the company more exposure to the world’s best location in the resource industry.

Despite the modest reserves on this land, there are plenty of resources to convert, which could result in a very profitable enterprise.

"The new assets promise value creation and improved earnings quality through diversification. The company’s best cash flow comes from Greens Creek, Casa Berardi is expanding and should soon become a useful contributor. These assets, operated as a Nevada division, promise to be a major new contributor,” Bridges said in the note.

Bridges said increased exposure to underground mining in investment friendly locations will likely benefit greatly, as Hecla has 125 years of experience in the industry and a history of positive management decisions.

Overall, Hecla has numerous technology-based projects designed to control costs and improve processes.

Price Action

Hecla shares traded up 1.7 percent to $3.45 Tuesday.

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Latest Ratings for HL

DateFirmActionFromTo
May 2020B. Riley FBRMaintainsNeutral
May 2020B. Riley FBRMaintainsNeutral
May 2020H.C. WainwrightReiteratesBuy

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