Bank of America Lifts Eldorado Gold Target to $54 on Skouries Progress
BofA upgrades Eldorado Gold to Buy, citing de-risked Skouries project and a shift to positive free cash flow by 2027.
Key points
- Bank of America upgraded Eldorado Gold to 'Buy' and raised its price target to $54, citing de-risked Skouries project.
- Skouries is expected to boost 2027 gold output by 29% and turn free cash flow positive at $1.5 billion.
- The project represents 32% of Eldorado's net asset value and drives a 40% increase in copper production with McIlvenna Bay.
Bank of America has upgraded Eldorado Gold Corp to a 'Buy' rating and raised its price target by 71% to $54, reflecting a significant reduction in execution risk at the company’s Skouries copper-gold project in Greece. The move follows site visits to both the Skouries development and the existing Olympias mine, which convinced the bank that the project is largely de-risked and positioned to transform Eldorado's financial profile.
The upgrade is driven by Skouries achieving first concentrate production earlier this month, with commercial operations targeted for the fourth quarter of 2026. As reported by Yahoo Finance, Bank of America now views the project as the primary growth driver for Eldorado, representing 32% of the company's net asset value and a critical lever for future gold output and cost efficiency.
Skouries Drives Major Production Gains
Once fully operational, Skouries is projected to increase Eldorado's gold production by 29% in 2027. Simultaneously, the bank forecasts a 24% reduction in all-in sustaining costs, a significant margin improvement that underpins the revised valuation multiple, which has been raised from 0.75x to 1.25x net asset value.
The project also acts as a key catalyst for copper output. Combined with the McIlvenna Bay project, Skouries is expected to drive a 40% increase in Eldorado's copper production in 2027. Bank of America maintains a bullish stance on copper prices, viewing this volume expansion as a substantial tailwind for the company's top line.
Free Cash Flow Turns Positive
The most decisive change in Eldorado's financial outlook is the swing in free cash flow. Bank of America forecasts a positive free cash flow of $1.5 billion in 2027, a sharp reversal from the projected outflow of $436 million in 2026. This liquidity shift is attributed directly to the commercial production ramp-up at Skouries.
Total capital returns are also expected to rise, reaching $472 million in 2027 from $299 million in 2026. This increased capacity to return capital to shareholders will occur even as Eldorado Gold continues to repay debt, indicating a strengthening balance sheet and improved financial flexibility.
Regulatory Environment Improves for Mining
The upgrade also reflects a broader shift in the Greek regulatory landscape. Bank of America notes that Greece has moved from an anti-mining stance to a more supportive position on mining activity. This change in political risk assessment removes a key discount from the valuation of Greek-based assets.
Upcoming catalysts for the stock include the connection of the Skouries site to the power grid and the release of an updated technical report expected in December. Despite a 5.7% gain in Toronto on Tuesday, the bank cautions that capital expenditure may be modestly higher than planned, though it deems commercial production achievable.
