No recommendation
No news or research item is a personal recommendation to deal. Hargreaves Lansdown may not share ShareCast's (powered by Digital Look) views.
(Sharecast News) - Analysts at JP Morgan sounded a confident note on the outlook for precious metals miner Fresnillo ahead of the next presidential elections in Mexico.
The latest polls were showing a wide roughly 20 percentage point lead for Claudia Sheinbaum, the candidate for the Morena coalition, over her rival Xochitl Galvez.
However, the analysts believed the outcome would be "marginally more balanced" than polls suggested.
"Thus, in a scenario of narrower victory, we could see a stronger system of checks & balances as it requires two-thirds majority in Congress to pass constitutional reforms," they said.
"Thus, we see relatively lower risks of legislation or constitutional changes which could be negative for miners or pose potentially negative implications for mining investment compared to previously."
As well, year-to-date gold and silver price gains of 14% and 34%, respectively, meant that Fresnillo shares were offering a mark-to-market upgrade on its earnings before interest, taxes, depreciation and amortisation of more than 20%.
They were also changing on hands on 5.0 and 4.4 times, respectively, their sport EV/EBITDA multiples for 2024 and 2025, compared to a mid-cycle average of approximately.
The analysts also referenced their recent decision to revise their long-term price forecast for gold from $1,600/oz. to $1,800/oz..
The value of investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the risks and commitments. This website is not personal advice based on your circumstances. So you can make informed decisions for yourself we aim to provide you with the best information, best service and best prices. If you are unsure about the suitability of an investment please contact us for advice.
