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Friday, April 23, 2010

TD Newcrest Upgrades Goldcorp (TSE:G) to 'Action List Buy'

TD Newcrest analyst Greg Barns has upgraded Goldcorp (TSE:G) (NYSE:GG) to 'Action List Buy' this week, and increased the target price to $55 a a share from $50 a share.

Barnes said the reasoning behind the upgrade was this, "We believe Goldcorp has the best growth profile among its senior peers. We use higher multiples for Goldcorp than Barrick (TSE:ABX) (NYSE:ABX) or Kinross (TSE:K) (NYSE:KGC), given our view that it has a better growth outlook, lower costs and lower political risk."

The specifics of that are related to production at Peñasquito, which has a projected increase in production for all four metals there, including gold, lead, silver and zinc.

Annual payable production, according to TD Newcrest, for each metal is estimated at 470,000 ounces of gold, 28 million ounces of silver, 450 million pounds of zinc, and 200 million pounds of lead; all on an annual basis.

gold could go far beyond that, with it reaching 800,000 ounces of annual production from 2010 - 2015, based on increased quality of grades.

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