How The Pieces Add Up: The iShares North American Natural Resources ETF Headed For $42



Looking at the underlying holdings of the ETFs in our coverage universe at ETF Channel, we have compared the trading price of each holding against the average analyst 12-month forward target price, and computed the weighted average implied analyst target price for the ETF itself.  For the iShares North American Natural Resources ETF, we found that the implied analyst target price for the ETF based upon its underlying holdings is $42.35 per unit.

With IGE trading at a recent price near $35.76 per unit, that means that analysts see 18.42% upside for this ETF looking through to the average analyst targets of the underlying holdings. Three of IGE’s underlying holdings with notable upside to their analyst target prices are B2Gold, New Gold, and Kinross Gold. Although BTG has traded at a recent price of $2.56/share, the average analyst target is 82.73% higher at $4.68/share. Similarly, NGD has 76.78% upside from the recent share price of $2.02 if the average analyst target price of $3.57/share is reached, and analysts on average are expecting KGC to reach a target price of $4.80/share, which is 30.11% above the recent price of $3.69.

Below is a summary table of the current analyst target prices discussed above:

Name Symbol Recent Price Avg. Analyst 12-Mo. Target % Upside to Target
iShares North American Natural Resources ETF IGE $35.76 $42.35 18.42%
B2Gold Corp BTG $2.56 $4.68 82.73%
New Gold Inc NGD $2.02 $3.57 76.78%
Kinross Gold Corp. KGC $3.69 $4.80 30.11%

Are analysts justified in these targets, or overly optimistic about where these stocks will be trading 12 months from now? Do the analysts have a valid justification for their targets, or are they behind the curve on recent company and industry developments? A high price target relative to a stock’s trading price can reflect optimism about the future, but can also be a precursor to target price downgrades if the targets were a relic of the past. These are questions that require further investor research.

Click here to find out 10 ETFs With Most Upside To Analyst Targets »

Products You May Like

Leave a Reply

Your email address will not be published.