On Thursday, National Bank Financial adjusted its stance on i-80 Gold Corp (IAU:CN) (OTC: IAUCF), downgrading the stock from Outperform to Sector Perform. The firm also revised its price target for the company's shares, lowering it from Cdn$3.50 to Cdn$2.25. This decision comes after a period where i-80 Gold's stock performance has outpaced that of its peers.
The company's shares recently showed notable gains, with an 11.3% increase over the last month, compared to a 3.5% rise in the S&P TSX Gold Index. Despite the recent strong performance in share price, the analyst cited a need to adjust expectations for the company's asset development, considering its balance sheet and existing obligations.
The analyst acknowledged the positive aspects of i-80 Gold, including the new leadership and the company's possession of quality assets within a Tier 1 jurisdiction. However, these factors were not enough to retain the Outperform rating as the financial institution recalibrated its outlook based on the company's financial position.
The revised price target of Cdn$2.25 represents a significant reduction from the previous Cdn$3.50 target, reflecting a more conservative valuation by National Bank Financial. This change in the price target is directly tied to the analyst's reassessment of the company's development expectations and financial commitments.
The downgrade to Sector Perform indicates that the analyst now views i-80 Gold's stock as likely to perform in line with the average returns of other companies within the sector, rather than outperforming as previously expected. This new rating suggests a neutral outlook on the stock's potential to provide returns relative to its market segment.
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