H.C. Wainwright Thinks Sierra Metals Inc’s Stock is Going to Recover

By Carrie Williams

H.C. Wainwright analyst Heiko Ihle reiterated a Buy rating on Sierra Metals Inc (SMTSResearch Report) today and set a price target of $4.25. The company’s shares closed on Friday at $1.63, close to its 52-week low of $1.53.

Ihle noted:

“We note that for the year copper prices increased by 5%, while gold prices remained flat. The significant increase in net income was mostly due to a $4.4 million non-cash loss on the distribution of not rated) assets during FY17, as well as a lower non-cash depletion charge in Peru ($10.5 million in FY18 vs. $31.5 million in FY17). The YoY decrease in the non-cash depletion charge was the result of a 134% increase to proven and probable reserves in Sierra’s NI 43-101 that was published during October 2017. We expect Sierra to build upon the solid financial results in FY18 as production is anticipated to grow next year. Successful exploration yields strong results. Sierra continues to aggressively pursue exploration activities at each of its three mines to support future production growth.”

According to TipRanks.com, Ihle is ranked 0 out of 5 stars with an average return of -2.7% and a 44.7% success rate. Ihle covers the Basic Materials sector, focusing on stocks such as Solitario Exploration & Royalty, Golden Star Resources Ltd, and Northern Dynasty Minerals.

The word on The Street in general, suggests a Moderate Buy analyst consensus rating for Sierra Metals Inc with a $4 average price target.

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The company has a one-year high of $2.90 and a one-year low of $1.53. Currently, Sierra Metals Inc has an average volume of 40.66K.

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Sierra Metals, Inc. engages in the production, exploration, and development of precious and base metals. It operates through the Peru and Mexico geographical segments. The Peru segment consists of Yauricocha Mine. The Mexico segment conssits of Bolivar and Cusi Mines. The company was founded on April 11, 1996 and is headquartered in Toronto, Canada.