RBC Capital lifts SSR Mining stock rating, target to $8 from $5.50

On Wednesday, RBC Capital Markets analyst Michael Siperco adjusted his stance on SSR Mining (NASDAQ:SSRM), upgrading the company’s stock rating from Underperform to Sector Perform and increasing the price target to $8.00, up from the previous $5.50. The upgrade reflects a more optimistic view of the mining company’s financial prospects and asset portfolio. The stock, currently trading at $8.19, has shown remarkable momentum with an 80.79% return over the past six months. According to InvestingPro analysis, SSR Mining appears undervalued based on its Fair Value calculations, with 8 additional exclusive insights available to subscribers.

Siperco cited the inclusion of the Cripple Creek & Victor mine, which is anticipated to be finalized in the first quarter of 2025 and represents 20% of SSR Mining’s net asset value (NAV), as a key factor in limiting the stock’s downside potential. The analyst also noted the positive impact of rising prices and cash flow from the company’s portfolio on its valuation.

Despite the upgrade and raised price target, Siperco maintained a cautious outlook due to ongoing uncertainties regarding SSR Mining’s operations in Turkey. He expressed the need for investors to gain more clarity on the situation in Turkey, including costs and any potential path to production, before fully reassessing the company’s valuation and future outlook.

The analyst removed the Speculative Risk qualifier from SSR Mining, indicating a more stable view of the company’s risk profile. This change suggests that the perceived risks associated with investing in SSR Mining have diminished, aligning with the broader market’s performance expectations.

SSR Mining’s stock adjustment by RBC Capital comes as the company prepares to integrate the Cripple Creek & Victor mine into its portfolio, a move that is expected to significantly contribute to its overall value. The new price target of $8.00 signifies a substantial increase from the previous target, signaling increased confidence in SSR Mining’s growth potential and financial stability.

In other recent news, SSR Mining Inc. announced significant developments related to its Çöpler and Marigold mines. An independent review by Call & Nicholas Inc. identified a design flaw as the cause of the heap leach failure at the Çöpler mine, providing clarity for the company as it seeks to restart operations. No definitive timeline has been provided for the mine’s resumption, however, SSR Mining is actively engaging with authorities to secure the necessary permits.

In a significant production milestone, SSR Mining’s Marigold Mine has produced a total of 5 million ounces of gold. The company’s 2024 growth strategy includes approximately $10 million in expenditures at Marigold, focusing on extending the mine’s life. Part of this investment is directed towards the Buffalo Valley project, which is expected to contribute to the mine’s longevity.

In the company’s Third Quarter 2024 financial results, SSR Mining reported the recovery of all nine missing colleagues from the Çöpler Incident and the installation of containment infrastructure. Remediation costs for the Çöpler mine are estimated to be $250 million to $300 million over the next 24 to 36 months. The company produced 97,000 gold equivalent ounces in Q3 at an AISC of $2,065 per ounce, reporting an attributable net income of $0.05 per share and a negative cash flow of $1 million. Operations at the Çöpler mine are expected to restart within 20 days of receiving regulatory approvals.

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