美股-金属与采矿业-北美金属与采矿业2018年Q3总结：功能失调的市场

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1、CORENorthAmericaMetals&MiningQ3/18wrap:Dysfunctionalmarkets?INDUSTRYUPDATEEquityResearch14November2018Earningsdrivevolatility:Q3/18earningswererelativelyinconsequential;whilewehavemadechangestomodels,nothingweheardcausedustomateriallyre-evaluateouroutlooks.Butyouw

2、ouldn’tknowthatfromwatchingthemarket,wherestockpricessetnewstandardsforextremereactions.GG,TECK,andAUYallhadrelativeunderperformanceofgreaterthan5%thedayafterearnings;GGwasdownover14%foramorethan3standarddeviationunderperformancevsthe10yraverage.Andthemarketreaction

3、sweren’tonlytothedownside:HBMoutperformedby+18%,3.7deviationsabovethe10yraverage.Weseethesereactionsassymptomaticofdysfunctionalmarkets–lowfundamentalvolumesmeanthatearningsreallymatter,evenwhentheydon’t.Goldcorpdownsidecase:Themostsignificantareaofinterestfrominves

4、torsfollowingthequarterwasGG–wefoundthebearsremainingfirmlyinthebearcamp,andbullsaskingfordownsidevaluations.Wehaveadjustedourmodelbutour$14targetisunchanged,leavingthestockstilloffering58%upsidetotarget.Ourstresstestdownsidecasearrivesatamarketvaluationof$9/shusing

5、unchangedmultiplesandpricedeck,or$5/shatspot.Weseethecurrentvaluationascompellingat0.9xP/NAVand4.8xEV/EBITDA2019,bothata~10%discounttocompsdespitetheproductiongrowthahead.Catalystsahead:WPMisourfinalcompanytoreport,Wednesdayaftermarket.OurQ3/18EPSestimateof$0.10isin

6、-linewithconsensus.Theendofearningsdoesnotbringanendtonewsflow:weexpect3yrguidancefromLUNinlateNovember,TECKcouldhavenewsonasupplementalcashdividendfollowingitsNovemberBoardmeetingandapotentialQB2partnerannouncementinDecember.AlsoinearlyDecemberwillbeNewmontguidance

7、for2019.Weseetheseeventsaspotentiallypositivefortheequities.Performancereview:SinceearlyOctober("NorthAmericaMetals&Mining:MasteringtheCycle;InitiatingCoverage",10/9/18)ourOverweightsaredown6%,EqualWeightsaredown6%,andUnderweightsaredown16%(versusS&P500down5%).Valua

8、tionshavegottenmoreattractiveandourmacroviewsremainintact-henceourpositivesectorviewremains.Feedbacksinceourlaunchsuggestsinvestorscontinu