美股-贵金属市场-贵金属市场更新：更高的价格

1、Precious Metals UpdateUpdating for higher metals prices; NovaGold and Eldorado look interestingNorth America Equity Research14 August 2019After the sharp rerating of precious metals prices were updating our earningsestimates our covered companies. We our forecasts are generally higher than the conse

2、nsus averages because we use the forward curve as the basic input modelling, which allows us to respond quicker to moves in metals prices. When looking out to valuations, we the market has lifted the precious metals equities so that the larger, more liquid names like Newmont and Agnico are now disco

3、unting a gold price in the $1500s 2019/20. companies seem to be a little more cautious and may offer opportunity for patient investors. Some smaller and higher risk companies still appear to offer upside like NovaGold (NG) and potentially Eldorado (EGO). In the silver category Pan American could be

4、suitable patient investors. One wild card that needs clarification is what Argentina will look like after the presidential elections in October. This country is important for Newmont and Pan American.updated our valuation models for metal prices based the forward curves. We offer our estimates of fa

5、ir values at a range of different metal prices on page 2. While the large liquid mining companies appear to have adjusted to about the$1,500/oz level, smaller miners with more specific risks still offer speculative appeal in our view. Its more difficult to estimate what the silver companies are disc

6、ounting due to Heclas refinancing issues and Pan Americans recent M&A. Weaker base metals prices could be a concern should a recession develop.Not exactly high flying adored, but Argentina nosedived after the weekends primary. President Macri took power in 2015 promising to open up the economy and f

7、ight corruption, but his austerity measures hurt voters and lifted inflation to +50% as the election looms. Macri is running against Alberto Fernndez who was tapped by the previous left-leaning Peronista president Christina Fernndez de Kirchner (unrelated) who is the VP. Newmont and Pan American hav

8、e mining interests in Argentina.Equity Ratings and Price TargetsPrecious Metals & CoalJohn Bridges, CFA, ACSM AC(1-212) 622-6430 HYPERLINK mailto:john.bridges john.bridgesBloomberg JPMA BRIDGES J.P. Morgan Securities LLCSiddharth Mishra(91-22) 6157-3018 HYPERLINK mailto:siddharth.mishra siddharth.mi

9、shraJ.P. Morgan India PrivateLimitedCompanyTickerMkt Cap ($ mn)Price CCYPrice Rat Curing PrevCur Price TaEnd Daterget Prev EndDateAgnico-Eagle (CN)AEM CN13,919.19CAD77.75OWn/c83.00Dec-2068.00n/cAgnico-Eagle MinesAEM US13,907.81USD58.68OWn/c64.00Dec-2052.00n/cB2GoldBTG US3,699.41USD3.64OWn/cn/cn/cB2G

10、old (CN)BTO CN3,692.51CAD4.81OWn/cn/cn/cCia de Minas Buenaventura SAABVN US3,715.83USD14.63OWn/c18.00Dec-20n/cn/cEldorado (CN)ELD CN1,279.99CAD10.70Nn/c13.00Dec-2010.00n/cEldorado GoldEGO US1,281.23USD8.09Nn/c10.00Dec-208.00n/cFranco-Nevada (CN)FNV CN17,490.94CAD123.50Nn/c117.00Dec-20110.00n/cFranco

11、-NevadaFNV US17,491.88USD93.29Nn/c90.00Dec-2085.00n/cHecla MiningHL US748.54USD1.54Nn/cn/cn/cKinross (CN)K CN6,144.53CAD6.45UWn/c8.00Dec-20Kinross GoldKGC US6,129.43USD4.86UWn/c6.00Dec-20Newmont Goldcorp CorpNEM US30,881.20USD37.66OWn/c43.00Dec-20n/cn/cNOVAGOLD (CN)NG CN2,169.28CAD8.83OWn/c12.00Dec-

12、208.00n/cNOVAGOLD ResourcesNG US2,175.89USD6.69OWn/c9.00Dec-206.00n/cPan American (CN)PAAS CN3,504.67CAD22.14Nn/c26.00Dec-20n/cn/cPan American SilverPAAS US3,503.98USD16.72Nn/c20.00Dec-20n/cn/cSource: Company data, Bloomberg, J.P. Morgan estimates. n/c = no change. All prices as of 13 Aug 19.See pag

13、e 47 for analyst certification and important disclosures, including non-US analyst disclosures.J.P. Morgan does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectiv

14、ity of this report. Investors should consider this report as only a single factor in making their investment decision. HYPERLINK / In more detailThe larger miners are trading close to the fair values we see for them at $1,500/oz. Miners with larger base metals revenues like Buenaventura are lagging

15、a little after hitting all-time highs relative to the HUI index at the end of March and perhaps as recession concerns grow over the companies base metal exposure.Stocks with the most potential upside from current levels include NovaGold and Eldorado, though neither is a plain vanilla investment wher

16、e we have raised target prices. NovaGold is unusual in having a very large permitted project in Alaska.While the mine project was designed in the late 2000s assuming a $1,600/oz and up gold price, recent moves have brought back interest in this project.Eldorado has faced challenges, especially as el

17、ements within the former SYRIZA Greek government were opposed to mining. The newly elected government in that country should be more supportive. The companys other question mark is what happens next at its large Kisladag project in Turkey.In the later stages of the 2010/11 gold bull market silver eq

18、uities took the baton and ran. Silvers generally higher volatility makes it, and its equities, interesting in the later stages of a run up in the gold price. Given the falling gold reserves at the larger mining companies and the myriad geopolitical reasons to buy gold, we dont believe we are past go

19、lds first act yet. However, it is notable that the gold silver ratio shows the lesser metal offers relative value from a longer term perspective.Pan American, with what could be three tier one silver assets, appears to offer longer term value, assuming it regains the confidence of local stakeholders

20、 in its recently acquired Escobal asset. The weekends surprise defeat at the polls for President Macri is a worry for PAASs interests in the country and its Navidad project.Hecla is levered to higher metal prices but is speculative until the company comes up with a plan to refinance its high yield d

21、ebt.Table 1: Fair Value Sensitivity to different Gold/Silver pricesGold Companies:TKR12-Aug-19Fair values at different gold/silver prices$1,300/$15$1,400/$17$1,550/$18$1,650/$25Old TPNew TPNewmont GoldcorpNEM$38.53$29.52$35.79$42.77$50.40$43.00$43.00KinrossKGC$5.00$3.90$4.68$6.13$7.80$6.00Buenav ent

22、uraBVN$15.19$14.93$17.62$20.22$26.88$18.00$18.00Agnico-EagleAEM$59.60$42.74$50.60$63.81$75.78$52.00$64.00EldoradoEGO$8.27$6.04$8.21$11.40$15.28$8.00$10.00B2GoldBTG$3.69$2.90$3.74$4.44$5.19NANANovaGoldNG$6.82$4.83$6.86$10.01$12.90$6.00$8.00Franco Nev adaFNV$94.15$74.13$82.89$92.13$100.06$85.00$90.00S

23、ilver Companies:Pan American SilverPAAS$17.00$17.23$20.71$24.19$38.60$20.00$20.00HeclaHL$1.60$1.09$1.95$2.81$5.67NANASource: J.P. Morgan Research.Eldorado has benefited from both the higher precious metals prices and the parliamentary success in Greece of the business friendly New Democracy party. N

24、ovaGolds performance highlights its characteristic as an out-of-the-money option on gold price underpinned by its half share in the permitted +30moz Donlin gold project.Pan American had a strong run when the gold-silver ratio improved sharply, but it has lost a little momentum after the ratio stabil

25、ized around 88X. The stock has stabilized against the HUI index, perhaps in part due to the Argentine uncertainty.Buenaventura traded at an all-time high relative to the HUI index at the end of March, so we see its weakness since then as stability as the higher metals prices allowed companies that h

26、ad been lagging for various reasons to catch up.Hecla has fallen back YTD after it announced that it was disappointed with progress at its recently acquired Nevada assets. Its plan had been that its high yield debt would be easier to refinance if it had bigger EBITDA, so it took much of its cash on

27、hand to buy the Klondex mines in Nevada. The repayment date for the high yield debt is coming closer, and the company is considering several different cash-generative transactions to reduce the size of its debt that must be refinanced. The fear is that as a forced seller Hecla may not get full value

28、 in a transaction.Table 2: EGO benefitted the most since mid May when gold price started soaring, while BVNs share price (50% revenue from base metals) has lost about 3% since thenPrice PerformanceLast Price1W2W1M2M3MYTDEldorado Gold8.27-4%2%18%94%118%187%Novagold6.822%6%11%53%73%73%Kinross5.004%17%

29、23%41%58%54%Panamerican Silver17.002%6%30%46%54%17%New Gold1.19-2%-19%-2%68%49%57%Agnico-Eagle59.605%10%15%29%45%48%Barrick18.043%6%9%30%45%34%B2Gold3.696%11%18%31%40%26%New mont Goldcorp38.531%2%-2%7%26%15%Franco-Nevada94.154%5%10%21%25%35%Hecla1.60-20%-18%-8%1%2%-32%Buenaventura15.19-2%-7%-7%-3%-3

30、%-6%Source: Bloomberg.J.P. Morgans precious metals analysts use the forward curve as the basis of the price curve used in valuation. The table below shows the new prices we are using.Table 3: Latest Gold/Silver price estimates used to generate earnings in modelsPrecious Metals1Q19A2Q19A3Q19E4Q19E201

31、9E1Q20E2Q20E3Q20E4Q20E2020ELT realGold - New1,3031,3091,5081,5161,4091,5231,5301,5351,5391,5321,400Gold - Old13031309141514231363143014361440144514381400% Change0%0%7%6%3%7%7%7%6%7%0%Silv er - New15.614.917.217.316.217.417.517.517.617.524.0Silv er - Old15.614.915.415.515.315.515.615.715.815.624.0% C

32、hange0%0%12%12%6%12%12%12%12%12%0%Source: J.P. Morgan estimates, Bloomberg.J.P. Morgans commodity team publishes metals price forecasts periodically, and their most recent price deck is shown below.Table 4: JPM Gold/Silver price estimates by commodities team in June 2019Precious Metals1Q19A2Q19E3Q19

33、E4Q19E2019E1Q20E2Q20E3Q20E4Q20E2020EGold - June1,3031,2901,3461,4051,3361,4351,4571,4671,4801,460Gold - M ar13031260134614051329% Change0%2%0%0%1%Silv er - June15.614.815.816.715.716.917.817.718.117.6Silv er - Mar15.615.016.617.416.1% Change0%-1%-5%-4%-2%Source: J.P. Morgan estimates, Bloomberg.Agni

34、co-Eagle (CN)OverweightAgnico-Eagle (AEM.TO;AEM CN)CompanyDataYear-end Dec ($)FY17AFY18AFY19EFY19EFY20EFY20EFY21EFY21EShares O/S (mn)237(Prev)(Curr)(Prev)(Curr)(Prev)(Curr)52-week range (C$)80.48-42.34Revenue ($ mn)2,2432,1912,4232,4792,9553,1493,0373,229Market cap ($ mn)13,919.19Adj. EBITDA ($ mn)9

35、307901,0161,0621,3921,5721,2551,438Exchange rate1.32EBITDA margin41.5%36.1%41.9%42.9%47.1%49.9%41.3%44.5%Free float(%)98.4%Adj. net income ($ mn)229721812102994052413503M - Avg daily vol (mn)1.37Adj. EPS ($)0.980.310.770.901.281.741.031.503M - Avg daily val ($67.5BBG EPS ($)0.990.19-0.75-1.34-1.54mn

36、)Reported EPS ($)1.05(1.40)0.830.951.281.741.031.50Volatility (90 Day)25DPS ($)0.360.400.440.440.440.440.440.44IndexS&P 500Dividend yield0.6%0.7%0.8%0.8%0.8%0.8%0.8%0.8%BBGBUY|HOLD|SELL15|3|2Adj. P/E59.8190.575.865.345.933.856.939.2Source: Company data, Bloomberg, J.P. Morgan estimates.Investment Th

37、esis, Valuation and Risks Agnico-Eagle (Overweight; Price Target: C$83.00) Investment ThesisAgnico is well positioned in a gold sector where replacing reserves has become moredifficult, in our view. The company has several long-life assets and we believe is on track to grow as two new mines ramp up

38、in 2019 and it eyes Upper Beaver as its next development.Agnicos production profile and a strong pipeline of opportunities offer cash flow visibility well into the 2020s. It has identified substantial resources at the new Amaruq deposit that look set to add several years to the Meadowbank mine with

39、the potential for more. Agnico is working on at least five projects in the near term. AEM is being opportunistic in the junior explorer space. It has recently acquired the prospective El Barqueo project in Mexico, although its currently only at the exploration stage, and we like the lower risk locat

40、ions and long life of Agnicos assets.ValuationWe are using a $1,550/oz gold price and an $18.00/oz silver price in our proprietary Black-Scholes model. This generates a Dec 2020 price target of $64.00 for AEM US. We are using a 1.30 CAD:USD exchange rate to derive our Dec 2020 price target of C$83.0

41、0 for AEM CN.Risks to Rating and Price TargetDownside risks include 1) disappointments at the mine projects; 2) operational problems at the LaRonde; 3) persistent lower gold price.Agnico-Eagle (CN): Summary of FinancialsIncome Statement-AnnualFY17A FY18A FY19E FY20E FY21E Income Statement- Quarterly

42、1Q19A2Q19A 3Q19E 4Q19ERevenue2,243 2,1912,4793,149 3,229Revenue532A527A678742COGS(1,058) (1,160)(1,174)(1,326) (1,534)COGS (277)A(279)A(299)(318)Gross profit1,185 1,0311,3051,823 1,695Gross profit255A247A379423Exploration expense-Exploration expenseSG&A(115) (125)(127)(152) (157)SG&A (29)A(29)A(33)(

43、36)Adj. EBITDA9301,0621,572 1,438Adj. EBITDA199A189A317358D&A(509) (554)(591)(759) (749)D&A (128)A(124)A(164)(174)Adj. EBIT576(47)600912Adj. EBIT106A99A182213Net Interest(79)(97)(108)(83)(66)Net Interest (26)A(27)A(28)(28)Adj. PBT358 (658)389730Adj. PBT60A48A125156Tax(98)(68)(154)(325) (273)Tax(15)A

44、(15)A(54)(69)Minority Interest-Minority Interest -Adj. Net Income229210405Adj. Net Income29A23A7087Reported EPS1.05 (1.40)0.951.74Reported EPS0.16A0.12A0.300.37Adj. EPS0.980.901.74Adj. EPS0.12A0.10A0.300.37DPS0.360.440.44DPS0.11A0.11A0.110.11Payout ratio34.7%46.5%25.6% 29.7%Payout ratio69.7%A93.3%A3

45、6.8%29.7%Shares outstanding233233233Shares outstanding236A237A237237Balance Sheet & Cash Flow StatementFY17A FY18AFY19EFY20E FY21ERatio AnalysisFY17AFY18AFY19EFY20EFY21ECash and cash equivalents644290552 1,219Gross margin52.8%47.0%52.6%57.9%52.5%Accounts receivable-EBITDA margin41.5%36.1%42.9%49.9%4

46、4.5%Inventories-EBIT margin25.7%(2.1%)24.2%29.0%24.4%Other current assets818877944Net profit margin10.2%3.3%8.5%12.9%10.8%Current assets1,462 1,0721,1661,496 2,171PP&E5,627 6,2346,4416,079 5,653ROE4.8%1.5%4.5%8.3%6.8%LT investments-ROA3.1%0.9%2.6%4.9%4.2%Other non current assets778595595ROCE7.0%(0.8

47、%)5.7%7.9%6.8%Total assets7,866 7,8538,2028,170 8,419SG&A/Sales5.1%5.7%5.1%4.8%4.9%Net debt/equity0.20.0Short term borrowings00360360Net debt/EBITDA0.50.1Payables-P/E (x)59.8190.565.333.839.2Other short term liabilities334409436P/BV (x)2.83.0Current liabilities334769796EV/EBITDA (x)21.925.819.213.01

48、4.2Long-term debt1,372 1,7211,3631,003 1,003Dividend Yield0.6%0.7%0.8%0.8%0.8%Other long term liabilities1,213 1,2201,3191,319 1,319Total liabilities2,919 3,3033,4513,118 3,121Sales/Assets (x)0.40.4Shareholders equity4,947 4,5504,7525,053 5,298Interest cover (x)19.021.8Minority interests00000Capex/S

49、ales39.0%49.7%28.5%12.6%10.0%Total liabilities & equity7,866 7,8538,2028,170 8,419Operating leverage661.0%4717.0%(10580.3%)192.2%(535.8%)BVPS21.26 19.5120.3721.66 22.72y/y Growth6.5% (8.2%)4.4%6.3% 4.9%Revenue y/y Growth4.9%(2.3%)13.1%27.0%2.5%Net debt/(cash)728 1,4131,433810EBITDA y/y Growth(2.7%)(

50、15.1%)34.5%47.9%(8.5%)Tax rate27.5%(10.3%)39.5%44.5%43.9%Cash flow from operating activities7687621,124 1,094Adj. Net Income y/y Growth95.2%(68.6%)191.7%93.0%(13.6%)o/w Depreciation & amortization509591759EPS y/y Growth88.8%(68.6%)191.7%93.0%(13.6%)o/w Changes in working capital(6)3(17)(40)DPS y/y G

51、rowth14.7%10.3%10.8%0.1%0.0%Cash flow from investing activities(1,000) (1,204)(732)(397) (323)Operational MetricsFY17AFY18AFY19EFY20EFY21Eo/w Capital expenditure(874) (1,089)(706)(397) (323)Gold Sales (koz)1,6941,6301,6961,9912,040as % of sales39.0% 49.7%28.5%12.6% 10.0%Cash Costs ($/oz)558.0637.064

52、3.8629.0688.5Cash flow from financing activities449(49)(464) (104)AISC ($/oz)o/w Dividends paid(85)(93)(104)(104) (104)P&P Gold Reserves (Moz)o/w Net debt issued/(repaid)3000(360)0Reserves + M&I Resources (Moz)Net change in cash216 (331)(19)263EV/Production ounceAdj. Free cash flow to firm(176) (477

53、)94772EV/Reserve ouncey/y Growth(167.7%) 170.6%(119.7%)720.0% 4.6%EV/Reserve & Resource ozNMNMNMNMNMSource: Company reports and J.P. Morgan estimates.Note: $ in millions (except per-share data).Fiscal year ends Dec. o/w - out of whichAgnico-Eagle MinesOverweightAgnico-Eagle Mines (AEM;AEM US)Company

54、DataYear-end Dec ($)FY17AFY18AFY19EFY19EFY20EFY20EFY21EFY21EShares O/S (mn)237(Prev)(Curr)(Prev)(Curr)(Prev)(Curr)52-week range ($)60.63-32.18Revenue ($ mn)2,2432,1912,4232,4792,9553,1493,0373,229Market cap ($ mn)13,907.81Adj. EBITDA ($ mn)9307901,0161,0621,3921,5721,2551,438Exchange rate1.00EBITDA

55、margin41.5%36.1%41.9%42.9%47.1%49.9%41.3%44.5%Free float(%)98.4%Adj. net income ($ mn)229721812102994052413503M - Avg daily vol (mn)1.46Adj. EPS ($)0.980.310.770.901.281.741.031.503M - Avg daily val ($72.9BBG EPS ($)mn)Reported EPS ($)1.05(1.40)0.830.951.281.741.031.50Volatility (90 Day)26DPS ($)0.3

56、60.400.440.440.440.440.440.44IndexS&P 500Dividend yield0.6%0.7%0.8%0.8%0.8%0.8%0.8%0.8%BBGBUY|HOLD|SELL-Adj. P/E59.7190.475.865.345.833.856.939.2Source: Company data, Bloomberg, J.P. Morgan estimates.Investment Thesis, Valuation and RisksAgnico-Eagle Mines (Overweight; Price Target: $64.00)Investmen

57、t ThesisAgnico is well positioned in a gold sector where replacing reserves has become more difficult, in our view. The company has several long-life assets and we believe is on track to grow as two new mines ramp up in 2019 and it eyes Upper Beaver as its next development.Agnicos production profile

58、 and a strong pipeline of opportunities offer cash flow visibility well into the 2020s. It has identified substantial resources at the new Amaruq deposit that look set to add several years to the Meadowbank mine with the potential for more. Agnico is working on at least five projects in the near ter

59、m. AEM is being opportunistic in the junior explorer space. It has recently acquired the prospective El Barqueo project in Mexico, although its currently only at the exploration stage, and we like the lower risk locations and long life of Agnicos assets.ValuationWe are using a $1,550/oz gold price a

60、nd an $18.00/oz silver price in our proprietary Black-Scholes model. This generates a Dec 2020 price target of $64.00 for AEM US. We are using a 1.30 CAD:USD exchange rate to derive our Dec 2020 price target of C$83.00 for AEM CN.Risks to Rating and Price TargetDownside risks include 1) disappointme