RBC Capital Markets upgraded the share rating of SSR Mining Inc. from "Sector Perform" to "Outperform" on Wednesday [1].
The upgrade signals a shift in investor confidence as the company reduces its exposure to volatile international markets. By pivoting its operational focus, the company aims to stabilize its valuation against industry competitors [1, 2].
Analysts at RBC set a new price target of $40 for the stock [1]. The firm said the company has transitioned into a Canada- and U.S.-focused company through strategic transactions to effectively exit Turkey, which has reduced its jurisdiction risk [2].
Despite the positive rating change, the share price declined by 1.9% during Wednesday trading [1]. This movement occurred while the company remained listed on the New York Stock Exchange and the Toronto Stock Exchange [1].
Separate from the RBC analysis, Zacks Investment Research upgraded the company to a Zacks Rank #2 (Buy) [1]. A Zacks analyst said SSR Mining is a solid addition to a portfolio given this recent upgrade [1].
Basing the "Outperform" rating on a comparative analysis, RBC said the company's valuation remains discounted when measured against its peers [2]. This suggests the stock may be undervalued despite the immediate dip in share price following the announcement [1, 2].
“Strategic transactions to effectively exit Turkey have transitioned it to a lower jurisdiction risk”
The upgrade reflects a broader trend of mining companies seeking 'safe haven' jurisdictions to attract institutional capital. By exiting Turkey and focusing on North American assets, SSR Mining is attempting to lower its risk profile, which typically allows for a higher valuation multiple regardless of short-term price volatility.
