Opinions Stockchase Insights
Equinox GoldEQX.TOHOLDFeb 27, 2023
Stockchase InsightsStock price when the opinion was issued
As of Jun 04, 2026. Market Open.
You might be interested:
Newfoundland is a good, as opposed to great, gold province. Balance sheet looks much better. Will do well going forward. Investors need to be prepared for shocks, rewards will be episodic. Market will be afraid of some of its moves, but the current CEO will ensure those things work out over time.
Rick RuleDoesn't own this one, but 6-7 weeks ago he reduced his gold exposure after this wonderful rally. Thinks we're in for a period of some consolidation. We're in the very early stages of a long-term bull market, it's just taking a breath. Past gold markets have tended to move in 3 legs. The intermediate and small companies will have lots of opportunities in the next leg higher.
He has some Kinross and some AEM. He likes their jurisdictions, where he's comfortable with the risks.
They've had mixed results in past years. They are, though, ramping up an Ontario project to fill capacity, as they pay down their heavy debt. At $2,800 gold and at full capacity, the company expects to pay down all debt in 3 years. Stick with it. It's expected for gold to keep rising, some saying $3,000.
;fill-opacity:1;'/%3e%3cpath%20d='M31%2018.6001V30H8V18.6001L14.1334%2022.4334L19.4999%2014L24.8669%2022.4334L31%2018.6001Z'%20fill='%23EE5432'%20style='fill:%23EE5432;fill:color(display-p3%200.9340%200.3310%200.1956);fill-opacity:1;'/%3e%3c/svg%3e){kind=small}
Premium content
Premium contentPremium contentRecent projects that are not on time very disappointing (market turned out to be correct). Problems with operations elsewhere in the company also a concerned. Investors could see another equity issue - but isn't sure. Company has a lot of debt. Will continue to hold share - believes in management.
Rick RulePremium contentEQX is reiterated as a TOP PICK. Management updated estimates of its 100% owned Ontario holding, indicating a higher grade of gold yield than previously estimated. We like that quarterly cash reserves are growing, while debt is reduced. It trades at 10x earnings and under book value. We recommend trailing up the stop (from $5.50) to $6.00 at this time, looking to achieve $10.50 -- upside potential of 23%. Yield 0%
(Analysts’ price target is $10.33)Premium contentEQX operates 8 producing gold mines in Brazil, Mexico, Canada and the USA and is enroute to producing 1 million ounces annually. The company expanded its holding in the Greenstone mine to hold 100% of the asset. It trades at 14x earnings and under book value. We recommend setting a stop-loss at $5.50, looking to achieve $10.00 -- upside potential over 35%. Yield 0%
(Analysts’ price target is $10.19)
Owns shares, and is a long term investors in the company. Share prices have been punished due to skepticism on mine build out - but is recovering. Expecting a higher share price if company is able to execute on latest mine prospects.
Rick Rule
EPS of $0.027 beat estimates of ($0.044) and revenues of $352.16M missed expectations of $361.39M.
The stock rose as better-than-expected adjusted EBITDA helped to lift the name and as its guidance for CAPEX was less than expected.
Management noted this was its strong quarter of production at the lowest costs for the year.
Significant progress was made at its mines and it is well-funded to complete construction at Greenstone for the first half of 2024.
The results largely looked strong, but the name has not held up as well as the underlying price of gold and the company's debt levels are quite high. We would consider it to be OK at current levels, although its high leverage does present some level of concern for us.
Unlock Premium - Try 5i Free