Stifel analysts reiterated their bullish outlook for precious metals heading into third-quarter earnings season, raising their near-term, 2025-2027 and long-term price expectations for both gold and silver.
In a research report released Monday titled Rising tide lifts all boats; margin expansion to drive strong cash flow generation in H2, the firm emphasized gold is the “only asset that survives every war, every conflict and every crisis.”
“While 3Q24 saw relatively lower central bank or Chinese demand for the yellow metal, the price was supported by weaker economic data points from the U.S., driving up the hopes of anticipated rate cuts. The Fed finally initiated the much-awaited monetary policy change with a surprising ‘jumbo’ 50 basis points rate cut,” he said. “Although the central bank purchases have relatively cooled down, overall they remained in a net buying position, which points to a stronger 2024 finish. Looking ahead, we expect this momentum in the price of gold to continue as rate cuts continue through 4Q to the end of 2025 with central bank buying, return of ETF investors in the west and the ongoing geo-political situation to offer support.”
With the changes to their price deck and company-specific adjustments, the analysts made a series of target changes to stocks in their coverage universe.
For senior producers, their changes are:
- Agnico Eagle Mines Ltd. (“buy”) to $140 from $114. The average is $121.40.
- Barrick Gold Corp. ( “buy”) to $33.50 from $28.50. Average: $34.18.
- Kinross Gold Corp. ( “buy”) to $18 from $14.50. Average: $15.83.
“The gold rally has seen strong share appreciation for the “torquier” names. Valuation multiples have started to move up, but sustained gold / silver prices at these levels should offer further upside. Our top gold ideas are: AEM, K, DPM, KNT, and CXB. On the silver names: AYA,” the analysts said.