The firm lowered its rating on shares to "market perform" from "outperform" with a $7 price target this morning.
BMO Capital said the company's balance sheet is manageable, but contributes to the greatest net asset value leverage of its peers, which poses a risk if commodity prices decline.
"In our base case range-bound price scenario, which largely reflects our long-term price forecasts, HL shares are already trading above peers on a NAV basis," the firm continued in an analyst note. "In a 25% downside scenario, the sensitivity analysis suggests HL's NAV could be negative."
Additionally, gold prices have continued to fall today on a stronger dollar and increasing expectations for an interest-rate increase this year, the Wall Street Journal reports.
For December delivery, gold was down 0.04% to $1,342.90 per ounce on the COMEX this afternoon. Silver for September delivery was up 0.03% to $18.87.
Hecla Mining, based in Coeur D Alene, ID, is engaged in the discovery, development and production of gold and silver as well as lead and zinc.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate HECLA MINING CO as a Hold with a ratings score of C. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we find that the company's return on equity has been disappointing.
You can view the full analysis from the report here: