Coeur Mining (NYSE:CDE) shares rallied sharply on Friday, climbing 11.1% to close at $17.39, as investors focused on record free cash flow generation rather than a disappointing earnings report. The advance recouped most of Thursday's 10.2% decline following the company's second-quarter results, and pushed the stock up 16.6% for the week.
The Chicago-based precious metals producer reported second-quarter free cash flow of $387.5 million, a 45% jump from the prior quarter and an all-time high. Management now expects to generate approximately $1.5 billion in free cash flow for the full year 2026, implying an 8.4% free-cash-flow yield based on Friday's market capitalization of $17.88 billion.
Revenue reached a record $1.086 billion, up from $856.2 million in Q1 and $480.7 million a year ago. Adjusted EBITDA was nearly flat sequentially at $478.3 million, despite softer realized metal prices. The free-cash-flow margin expanded to 35.7% from 31.2% in the prior quarter.
The strong cash flow was driven largely by the Canadian assets acquired in the recent deal. Rainy River contributed $123.1 million in mine-level free cash flow, while New Afton added $50.6 million, together accounting for 44.8% of consolidated free cash flow. CEO Mitchell Krebs highlighted "growing momentum" across North American operations, while acknowledging the impact of lower prices, higher costs, and slower ramp-ups.
However, the earnings picture was less rosy. Adjusted earnings came in at $0.12 per share, missing the FactSet consensus of $0.26 by $0.14. The shortfall was largely due to a $140 million noncash inventory-allocation expense, which reduced earnings by $0.10 per share.
Looking ahead, the company revised its 2026 guidance. Total gold production midpoint was lowered by 7.7% to 690,000 ounces, while total copper output was cut by 21.7% to 45 million pounds. Capital expenditure midpoint was raised by 16.8% to $562.5 million. Cost guidance also increased, with New Afton gold CAS up 31.8% and Rainy River gold CAS up 26.7%.
Despite the operational challenges, analysts remain bullish. FactSet data shows nine Buy ratings, one Overweight, and two Hold ratings, with a consensus Buy. The median price target is $23, representing about 32% upside from Friday's close. However, the lowest estimate is $18, just 3.5% above current levels, reflecting a wide range of views on near-term earnings.
The broader precious metals complex also saw strong weekly gains, with gold futures up 7.2% and silver futures up 10.0%, supported by softer U.S. payrolls data that dampened expectations for imminent interest-rate hikes. Peer performance was mixed: Hecla Mining (HL) gained 6.3% on Friday, Pan American Silver (PAAS) rose 6.6%, and First Majestic Silver (AG) advanced 6.5%, but all underperformed Coeur on the day.
As of June 30, Coeur held $1.052 billion in cash and short-term investments against $705 million in total debt, leaving a net cash position of $347 million. Through July 31, the company had repurchased $121 million in shares and paid its first two-cent semiannual dividend. Investors will watch upcoming inflation data—July CPI due Wednesday and PPI on Thursday—for further direction on rates and metals prices.
