Boliden AB, a Swedish copper and zinc producer, advanced to a three-week high in Stockholm trading after HSBC Holdings Plc raised its rating on the stock, citing more conservative profit estimates.
Boliden climbed as much as 3.4 percent to 89.35 kronor, the highest intraday price since June 20. It traded up 3 percent at 3:42 p.m. local time, the biggest gain on the OMX 30 Stockholm index after SKF AB.
HSBC upgraded its recommendation on Boliden to neutral from underweight, saying its earlier rating was “based on the view that consensus was much too optimistic.”
Estimates for earnings before interest and taxes have declined by 47 percent in the past three months and are “now in the right ball park,” the brokerage said today in an e-mailed note. “The stock will now move in line with the sector.”
Boliden has seen income fall the past two years as commodity prices declined and mining costs rose. Second-quarter earnings will be “weak,” HSBC said, citing maintenance expenses, lower metal prices and possible inventory revaluation.