GLOBE SAYSThe Globe and Mail reports in its Tuesday, May 28, edition that CIBC World Markets analyst Bryce Adams has resumed coverage on Hudbay Minerals with an "outperformer" recommendation.
The Globe's David Leeder writes that Mr. Adams shaved his share target by a loonie to $14.50. Analysts on average target the shares at $15.39.
Mr. Adams says in a note: "We resume coverage of Hudbay Minerals as we come off restriction following its recent $402-million bought-deal financing. Use of proceeds are listed as accelerating Copper Mountain optimizations, debt repayments under the company's 3P plan, potential sanctioning of Copper World, evaluation of mill expansions at Constancia and New Britannia, and general corporate purposes.
Overall, we did not see an immediate need for the financing, but at the same time we were unsurprised by the update as several of Hudbay's copper peers have raised equity in recent periods and been well supported. We view Hudbay as a deleveraging story and this deal accelerates the company's net debt reductions, as do strong FCF from the high-grade Pampacancha pit in Peru and commodity strength." The Globe reported on May 16 that National Bank had hiked Hudbay to "outperform." It was then worth $13.53.