Coeur's Rosy 2026 Outlook Clashes with High Valuation and Execution Risks

What happened

Coeur Mining reported record Q4 2025 financials, including $1.0 billion adjusted EBITDA and $666 million free cash flow, as it transitions from heavy capex to harvest mode after Rochester and Las Chispas expansions. However, the DeepValue analysis shows the stock at $19.11 already prices in lofty expectations with a 38.0x EV/EBITDA and 29.7x P/E, leaving no margin of safety for delays or misses. The proposed New Gold deal aims to boost 2026 targets to $3 billion EBITDA and $2 billion FCF, but it hinges on Investment Canada Act approval by mid-2026, a key gating item. Filings reveal operational fragility, such as Rochester's expansion economics being sensitive to throughput and costs, and proxy disclosures flag missed incentive targets due to ramp-up delays. Thus, while the news amplifies a bullish narrative, the deep value perspective underscores that hard de-risking is still required.

Implication

The high valuation implies significant execution risk, where any slip in Rochester's performance or delay in the New Gold deal could trigger sharp downside. Key near-term monitors include Coeur's FY2025 results on February 18, 2026, and the Investment Canada Act approval by May 31, 2026, which will validate or challenge the 2026 growth narrative. Successful integration at Las Chispas and steady-state margins at Rochester are essential for free cash flow generation, but these remain uncertain given past delays and accounting noise. The crowded market sentiment and insider selling in mid-2025 add to the caution, suggesting momentum may be fragile. Ultimately, investors are better off awaiting lower entry points or clear de-risking events to improve risk-adjusted returns.

Thesis delta

The new article reinforces the optimistic 2026 outlook, but it does not alter the DeepValue thesis, which remains a 'WAIT' call due to high valuation and unproven execution. No shift has occurred; the thesis still requires observable catalysts like regulatory approval or improved operational guidance to justify investment at current levels.