Equinox Gold Faces Downgrade to “Strong Sell” by Zacks Research

Shares of Equinox Gold (NYSEAMERICAN:EQX) were downgraded from a hold rating to a strong sell rating by Zacks Research in a report released on August 15, 2023. This shift reflects growing concerns among analysts regarding the company’s future performance. The decision comes amidst a backdrop of varied opinions from other research firms on the stock, highlighting a complex sentiment in the market.

Several analysts have recently commented on Equinox Gold. National Bankshares maintained an “outperform” rating on August 15, while BMO Capital Markets began coverage of the stock on June 18, issuing an “outperform” rating. Meanwhile, Cormark upgraded its position from a “hold” rating to a “moderate buy” that same day. Notably, CIBC World Markets also elevated its rating from “hold” to “strong buy” on October 9. TD Securities reiterated a “buy” rating on September 5.

Currently, two investment analysts have rated Equinox Gold with a strong buy, four with a buy, two with a hold, and one with a sell rating. According to data from MarketBeat.com, the stock has an average rating of “moderate buy” and a target price of $26.00.

Stock Performance and Financials

On August 15, shares of Equinox Gold opened at $12.02, reflecting a decrease of 5.5%. The company boasts a market capitalization of $9.41 billion and a price-to-earnings (P/E) ratio of -200.30, indicating a challenging financial landscape. Over the past year, the stock has seen a low of $4.95 and a high of $12.93. The business also maintains a 50-day moving average of $9.91 and a 200-day moving average of $7.61.

Equinox Gold reported its latest earnings on August 13, revealing earnings per share (EPS) of $0.11 for the quarter, surpassing the consensus estimate of $0.02 by $0.09. During this period, the company generated revenue of $478.64 million, exceeding analysts’ expectations of $470 million. The company’s return on equity stood at 3.54%, while its net margin was reported at -1.21%. Notably, quarterly revenue increased by 77.7% compared to the same quarter last year, when the business posted an EPS of ($0.01). Analysts anticipate that Equinox Gold will achieve an EPS of 0.85 for the current year.

Institutional Investor Activity

Recent movements by institutional investors have also influenced Equinox Gold’s stock trajectory. Ruffer LLP significantly increased its stake by 322.1% during the second quarter, acquiring an additional 5,722,871 shares, bringing its total holding to 7,499,601 shares valued at $43.27 million. Other notable investments include Eschler Asset Management LLP, which initiated a new position valued at approximately $968,000, and Invenomic Capital Management LP, which raised its stake by 8.2%, owning 1,320,532 shares valued at $9.08 million.

Other hedge funds, including Credit Industriel ET Commercial and UMB Bank n.a., also entered new positions during the second quarter, valued at approximately $149,000 and $200,000, respectively. Currently, institutional investors and hedge funds hold approximately 38.85% of Equinox Gold’s stock.

Equinox Gold Corp. continues to focus on exploration, acquisition, development, and operation of mineral properties across the Americas, with interests in various gold and silver deposits located in regions such as California, Mexico’s Guerrero State, and several Brazilian states. As the market navigates through these ratings changes, stakeholders will be watching the company’s next moves closely.