When times look rough, many people like to look to gold for investments, as it does an excellent job of preserving wealth. Gold, after all, has been roughly the equivalent of money, if not outright money, for most of human history. But that didn’t help gold stock Eldorado Gold (TSE:ELD) (NYSE:EGO), as it lost over 2% in Friday afternoon’s trading thanks to a rating cut at Stifel.
Stifel cut the rating on Eldorado from Buy to Hold and set the price target at C$17.25, declaring that Eldorado was “…nearing inflection points across its portfolio.” The biggest of these was the Lamaque project in Quebec, which revealed its large mineral potential that now has the potential for extended life-of-mine to the Ormaque and Lower Triangle bases in the immediate area.
Meanwhile, Stifel also looks for the Skouries project—this one located in Greece—to produce some substantial new growth potential. And while Stifel looks for gold production to actually improve, it also looks for inflation to remain high. While that will likely help gold prices, it won’t do any favors for the necessary inputs required to pull gold out of the ground.
A Bright Side Under the Tarnish
Meanwhile, there is some good news for Eldorado Gold, as gold production is on track to rise 45% in 2027. And indeed, the Skouries project is well underway, with around 50% completed and a fresh supply of funding recently acquired to help build that project out. Meanwhile, Amex Exploration got a little extra investment from Eldorado, giving Eldorado a little more access to the gold market in Quebec. This move seems to be working well for Eldorado so far via the Lamaque project.
Is Eldorado Gold a Buy or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on ELD stock based on two Buys, five Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 30% rally in its share price over the past year, the average ELD price target of C$17.47 per share implies 6.42% upside potential.
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