The precious metals sector is undergoing a significant transformation following Coeur Mining’s landmark announcement. The gold and silver producer has set in motion a $7 billion acquisition of New Gold, a move poised to create a dominant North American mining entity. The combined company is projected to achieve an annual production output of approximately 900,000 ounces of gold and 20 million ounces of silver. This megadeal, however, has sparked a vigorous debate on Wall Street, with investors questioning whether the stock’s meteoric 160% surge since the start of the year is sustainable or a sign of an overheating market.
Record Operational Performance Fuels Momentum
Prior to the acquisition news, Coeur Mining demonstrated formidable operational strength in its third-quarter 2025 results. The company posted record revenue of $555 million and generated $238 million in operating cash flow. GAAP net income soared to a historic $267 million, or $0.41 per share.
Production for the quarter reached 111,364 ounces of gold and 4.8 million ounces of silver. Financially, the company more than doubled its cash reserves to $266.3 million while reducing its debt by over $228 million during the year. This disciplined approach lowered the net debt-to-adjusted EBITDA ratio to just 0.1x. Management anticipates further strengthening its cash position to exceed $500 million by the end of 2025, with full-year EBITDA expected to break the $1 billion threshold for the first time.
Details of the Transformative $7 Billion Deal
Formally disclosed on November 3, 2025, the acquisition is structured as an all-stock transaction. Shareholders of New Gold will receive 0.4959 Coeur shares for each of their shares, a deal that values New Gold at $8.51 per share and represents a 16% premium over its closing price on October 31.
The pro-forma entity presents a compelling profile:
* A diversified portfolio encompassing seven mines across North America.
* An anticipated 2026 EBITDA of approximately $3 billion.
* A forecasted 2026 free cash flow of $2 billion.
* A combined market capitalization of roughly $20 billion.
* Existing Coeur shareholders will maintain a 62% stake in the new company.
Should investors sell immediately? Or is it worth buying Coeur Mining?
Pending shareholder and regulatory approvals, the transaction is slated for completion in the first half of 2026. Following the closure, New Gold’s CEO, Patrick Godin, is expected to join Coeur’s board of directors.
A Divided Response from Market Analysts
The strategic move has elicited a mixed reaction from financial analysts, creating a clear split in market sentiment. Zacks Research downgraded its rating on Coeur from “Strong Buy” to “Hold,” citing valuation concerns after the substantial price rally, despite acknowledging the strong operational results. Similarly, Cormark adjusted its stance from “Moderate Buy” to “Hold.”
In contrast, several firms reaffirmed their bullish outlook. TD Securities boosted its price target from $23 to $25 and maintained a “Buy” recommendation. BMO Capital Markets held its target at $23, while Roth MKM cited a $20 fair value—both continuing to advise clients to buy the stock. Raymond James established a price target of $21. The current analyst consensus sits at “Moderate Buy,” with an average price target of $16.32, derived from two “Strong Buy,” six “Buy,” and three “Hold” ratings.
Financial Health Nears Investment Grade
Coeur Mining’s financial standing continues to improve dramatically. The company’s net debt has fallen below $100 million in 2025, a trajectory that could soon place it in contention for an investment-grade credit rating. A $75 million share repurchase program announced in May 2025 is approximately 10% complete, with shares being bought back at an average price of $11.79.
Institutional investors currently hold about 63% of the outstanding shares, with recent filings indicating continued accumulation by hedge funds and asset managers. This suggests sustained confidence in the company’s strategic direction within a favorable precious metals pricing environment, even as the valuation debate intensifies.
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