Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF, FRA:6E2) comes out on top as analysts at Jefferies ran the ruler over a number of London-listed gold producers.
Jefferies opened its coverage of Endeavour with a 'Buy' rating and pitched a price target of 5.700p that sees some 62% upside to the miner's share price in London.
The bank's review comes after a six-week sell-off left gold producers trading at historically low valuations.
Jefferies forecasts around $5 billion of free cash flow over the next three years.
Progress at Assafou, improving grades at Sabodala and potential capital returns could drive a rerating.
Hochschild Mining PLC (LSE:HOC, OTCQX:HCHDF, FRA:H3M) and Pan African Resources PLC (LSE:PAF, OTCQX:PAFRY, JSE:PAN) were also started with Buy ratings, with targets of 625p and 130p, implying 45% and 41% upside respectively.
Jefferies said Hochschild’s valuation does not fully reflect improving performance at Mara Rosa or its development pipeline, while Pan African should benefit from production growth, margin expansion and greater exposure to Australia.
The broker remains bullish on gold, forecasting an average price of roughly $4,600 an ounce through 2030 and a peak of $5,000 in 2027. It said currency debasement, money-supply growth and central-bank buying remain supportive.
Fresnillo PLC (LSE:FRES) and Valterra Platinum Ltd (LSE:VALT, JSE:VAL) were initiated at Hold, with limited upside to targets.
