The stocks are in turmoil worldwide due to the recent events. While the investors hoped that the coronavirus pandemic was waning, additional stress because of the critical condition of North Korea’s dictator and collapsed oil prices hit the markets hard.
The majority of the companies are still in the red. But if you want to plan for the future, it’s essential to choose those stocks, which have the most potential. Gold is just such an investment. It’s always valuable, no matter what.
McEwen Mining is a small-cap company, which is mining both gold and silver in North and South America. The company generated a gross profit of $9 million in 2019, pulling 174,420 gold equivalent ounces out of the ground.
Gold and silver remain highly sought-after commodities, especially in the light of oil’s downfall. That’s why the long-term outlook for McEwen Mining remains upbeat.
According to Heiko Ihle, H. C. Wainwright’s analyst, the firm previously encountered several operational issues in 2019. But the problems faced in 2020 due to the pandemic are mostly out of its control. Despite that, he believes that the investors are on the cusp of a bull market for gold. Furthermore, the current share price for this stock represents an attractive entry point.
What about the problems that this stock encountered in 2020?
McEwen announced last month that it would scale down operations at two major mines, Gold Bar in Nevada and the Black Fox in Canada. The company also withdrew forward guidance for 2020 production. According to McEwen, mine shut-downs at two sites in Argentina were caused by coronavirus pandemic. So far, McEwen did not issue new production guidance for the current year.
While this isn’t very good news, analysts still consider this company to be a good investment. Ihle lowered the price target from $2 to $1.75, but he still sees an impressive 73% upside potential for the stock. However, the average price target at $2.29 indicates room for an incredible 127% upside for this year.