Fresnillo (FRES)

Sector:

Mining

Index:

FTSE 100

634.80p
   
  • Change Today:
      5.80p
  • 52 Week High: 1,027.50
  • 52 Week Low: 601.00
  • Currency: UK Pounds
  • Shares Issued: 736.89m
  • Volume: 384,097
  • Market Cap: £4,677.80m
  • Beta: 0.16

Morgan Stanley downgrades Fresnillo on Mexico uncertainty

By Michele Maatouk

Date: Thursday 22 Nov 2018

LONDON (ShareCast) - (Sharecast News) - Precious metals miner Fresnillo slumped on Thursday as Morgan Stanley cut its stance on the stock to 'underweight' from 'equalweight' and slashed the price target to 715p from 1,100p citing uncertainty about proposed mining legislation in Mexico.
The bank said it sees an impact of up to 11% earnings per share as possible from the proposal of nine recent bills/resolutions in Mexico.

"However, with the emergence of two bills that could further impact Fresnillo, additional uncertainty now surrounds the investment case, carrying risks to the premium valuation," it said in a note.

Earlier this month, a lawmaker in Mexico presented a bill that would require the consent of indigenous communities before granting mining concessions on their land.

The bill was presented by Senator Angelica Garcia from leftist President-elect Andres Manuel Lopez Obrador's National Regeneration Movement (MORENA) party, which holds majorities in both houses of Congress.

"The increasing number of bills being proposed in Mexico bears potentially negative connotations for the mining industry and thus Fresnillo," said MS.

"Our move to underweight reflects the impact from any rise in mining industry risks on Fresnillo, as it currently trades on a premium valuation versus peers, in part driven by the market viewing Mexico as a favourable jurisdiction for mining. With uncertainty introduced, we see scope for a de-rating and for this premium to contract pending further clarity."

The bank noted that Fresnillo's share price has risen about 10% since the announcement of these bills, so is not appearing to price much risk yet. For now, MS reflects this increased risk by resetting its price target at a level between its bear and bull cases, reflecting its view of the increasing likelihood of a bear case scenario, including a rising tax burden.

At 1230 GMT, the shares were down 11% to 812.31p.

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Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are delayed by at least 15 minutes.

 

Fresnillo Market Data

Currency UK Pounds
Share Price 634.80p
Change Today 5.80p
% Change 0.92 %
52 Week High 1,027.50
52 Week Low 601.00
Volume 384,097
Shares Issued 736.89m
Market Cap £4,677.80m
Beta 0.16

Fresnillo Star Ratings

Compare performance with the sector and the market.
more star ratings
Key: vs Market vs Sector
Value
54.81% below the market average54.81% below the market average54.81% below the market average54.81% below the market average54.81% below the market average
94.92% below the sector average94.92% below the sector average94.92% below the sector average94.92% below the sector average94.92% below the sector average
Price Trend
70.44% below the market average70.44% below the market average70.44% below the market average70.44% below the market average70.44% below the market average
31.2% below the sector average31.2% below the sector average31.2% below the sector average31.2% below the sector average31.2% below the sector average
Income
64.41% below the market average64.41% below the market average64.41% below the market average64.41% below the market average64.41% below the market average
82.61% below the sector average82.61% below the sector average82.61% below the sector average82.61% below the sector average82.61% below the sector average
Growth
29.14% below the market average29.14% below the market average29.14% below the market average29.14% below the market average29.14% below the market average
80.33% below the sector average80.33% below the sector average80.33% below the sector average80.33% below the sector average80.33% below the sector average

What The Brokers Say

Strong Buy 4
Buy 0
Neutral 11
Sell 0
Strong Sell 0
Total 15
buy
Broker recommendations should not be taken as investment advice, and are provided by the authorised brokers listed on this page.

Fresnillo Dividends

  Latest Previous
  Interim Final
Ex-Div 08-Aug-19 25-Apr-19
Paid 06-Sep-19 24-May-19
Amount 2.60¢ 16.70¢

Trades for 22-Oct-2019

Time Volume / Share Price
12:27 249 @ 634.80p
12:27 250 @ 634.80p
12:27 125 @ 634.60p
12:27 146 @ 634.60p
12:27 250 @ 634.60p

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