Analyst Actions: HudBay Sinks to 3-year Lows but Most Analysts Still say Buy

By MT Newswires,  May 15, 2012, 04:00:24 PM EDT

HudBay Minerals Inc. (HBM.TO) is having a rough week. Shares since Monday morning are down about 13%, trading late this afternoon at $8.22, a three-year low, the Globe & Mail reports.

Sinking copper prices over the past couple of days have undoubtedly turned investors away. But HudBay's lacklustre first-quarter earnings report, released last week, hasn't helped. Adjusted profit of 7 cents was about a nickel below consensus.

Analysts are clearly signalling they think the stock is oversold. According to Bloomberg data, 15 of them have buy ratings, two have holds and only one has a sell. The mean price target on the Street is $15.27, close to double where it's trading at today.

Raymond James analyst Alex Terentiew trimmed his price target today, by $1 to $12, partly in response to the equity dilution that may result from the company's plans announced Monday to raise $400-million (U.S.) through an 8-year senior unsecured note offering. But he's not recommending investors offload their shares, reiterating a "market perform" rating.

Terentiew is taking comfort in the expectation that the extra cash will help fill the company's funding gap for its projects over the next few years, which he pegs at a total of $1.1-billion




The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.


This article appears in: Investing, Commodities

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