''Oft compared with AURThis is the lastest Canaccord Recomendation on AUR ...... does this change anything in our HBM camp ?
After our "sell on news" event, HBM shud still be ok.
RECOMMENDATION CHANGES - TARGET PRICE REVISIONS
Aur Resources (AUR : TSX : $28.88) - Sell - Target: $27.50
Orest Wowkodaw, CA, CFA
Comment: Lowering rating on Aur Resources to SELL based on relative
valuation
We are reducing our rating on Aur Resources to SELL from Hold based on the
shares' recent price appreciation and the resulting relative valuation to
the peer group. At current levels, the shares have a negative implied
return of 4.8% to our C$27.50 target price, which is based on 5.5x our
2008E CFPS plus forecast 2007 year-end net cash of $4.55 per share. While
we continue to have a slight upward bias to our near-to-medium term copper
price forecasts, the impact to our estimates and target price is
anticipated to be largely offset by the stronger Canadian dollar. Aur is
currently trading at 6.8x and 7.1x our 2007 and 2008 CFPS estimates,
respectively, and at a 18.3% premium to our 8% NPV valuation of C$24.41 per
share, which compares with our mid-cap base metal producer coverage
universe average of 6.8x, 6.1x, and a 20.5% premium to NPV. Perhaps most
importantly, Aur is currently trading well above the 2008E CFPS multiples
of its closest peers, Inmet Mining (IMN : TSX : $72.00 | BUY) and First
Quantum (FM : TSX : $83.66 | BUY), which trade at 5.3x and 5.6x,
respectively, as both companies anticipate significant production growth
next year and, in our view, have a higher likelihood of becoming takeover
candidates despite building a similar level of net cash.