GLOBE SAYShe Globe and Mail reports in its Wednesday edition that Scotia Capital analysts Orest Wowkodaw and Eric Winmill expect Canadian miners to post "relatively mixed" third quarter financial results as "improved operating performance is likely to be largely offset by weaker commodity prices.
" The Globe's David Leeder writes that in response to the impact of a weaker Canadian dollar and "minor" commodity price changes, the two analysts boosted their share target for Hudbay Minerals, which they rate "sector outperform," to $15 from $14.50. Analysts on average target the shares at $15.91.
The two analysts say in a note: "With cost pressures stabilizing and capex spending easing, we forecast cash margins to expand. Of concern, our estimates appear well below current consensus expectations for most companies, and we expect material negative consensus revisions over the coming weeks. In addition, we anticipate the market to focus on potential negative guidance revisions and select project ramp-up updates.
The large and mid-cap producers continue to trade at relatively elevated valuations (we estimate an average implied Cu price of $5.60/lb or 26 per cent above spot), reflecting improved market sentiment on Chinese demand."