The Zacks Analyst Blog Highlights: Barrick Gold, Gold Fields, Goldcorp, Newmont Mining and Westar Energy

Zacks

For Immediate Release

Chicago, IL – August 26, 2013 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the Barrick Gold Corporation (ABX-Free Report), Gold Fields Limited (GFI-Free Report), Goldcorp Inc. (GG-Free Report), Newmont Mining Corporation (NEM-Free Report) and Westar Energy Inc. (WR-Free Report).

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Friday’s Analyst Blog:

Barrick Divesting 3 Mines for $300M

Barrick Gold Corporation (ABX-Free Report) has agreed to sell its Yilgarn South assets (Yilgarn South), comprising the Granny Smith, Lawlers and Darlot mines, in Western Australia to Gold Fields Limited (GFI-Free Report) for about $300 million. The deal is expected to close on Oct 1.

The agreement is subject to closing conditions, including clearance by Australia's Foreign Investment Review Board, consent of the Western Australian Minister for Mines for the transfer of the property tenements, and the assignment of certain supply contracts.

The deal offers Gold Fields an option to deliver up to half of the consideration in its own shares to Barrick. Pricing of the shares will be based on the five day volume weighted average price, prior to, but not including closing. The acquisition will provide Gold Fields with an additional 452,000 ounces of production from the mines.

Barrick, which is among the major players in the gold mining industry along with Goldcorp Inc. (GG-Free Report) and Newmont Mining Corporation (NEM-Free Report) plans to use the proceeds for general corporate purposes including debt repayment.

The move testifies Barrick’s strategy of focusing on aggressive cost cutting and low costs assets and doing away with the non-profitable ones in order to improve its free cash flow profile. The company also slashed its dividend by 75% in the most recent quarter in the wake of falling gold prices.

Barrick’s Pascua-Lama mine in the Andes, which is the highest gold mine in the world, has also been going through a rough patch. Construction at the mine has been delayed due to the falling gold prices, rising costs and challenging market conditions. Barrick announced that Copiapo Court of Appeals have issued a ruling that the company must build a water management system at the Pascua-Lama project before restarting construction activities in Chile.

Barrick also recorded a hefty after-tax impairment charge of $8.7 billion in the second quarter of 2013 due to falling gold prices. Lower metal prices weighed on its bottom line. Adjusted earnings (excluding one-time items) fell to 66 cents per share in the quarter from 82 cents per share in the year-ago quarter, but was ahead of the Zacks Consensus Estimate of 56 cents.

Barrick has maintained its gold production forecast for 2013 at 7-7.4 million. The company also backed its full year all-in sustaining cost guidance at $900-$975 per ounce.

Barrick currently retains a Zacks Rank #3 (Hold).

Westar to Expand Renewable Portfolio

Westar Energy Inc. (WR-Free Report) announced its intention to expand its renewable portfolio by offering request for proposals to potential renewable energy developers. The company hopes to add at least 80 megawatts (MW) of clean energy resources by securing one or more long-term contracts with the developers by 2016.

Westar Energy is keen on adding renewable generation assets in the next few years. The company stated that its first preference will be for projects located in Kansas. The company will provide a part of its Ironwood development rights in Ford and Hodgeman counties as part of the proposal. The developers can work on their own sites as well.

The proposals are due Sep 13, 2013. The company is mostly interested in projects that will bode well for the Kansas economy. The state has been known for its large wind resource base but Westar Energy is eager to welcome other alternative energy proposals.

As of now, the company has about 700 MW of renewable capacity under its belt and the current proposal will aid Westar Energy to achieve the 2016 Kansas renewable energy standard.

However, the final decision will depend on several factors like overall cost, availability of adequate transmission infrastructure to supply energy to the consumers, service reliability, state’s renewables policies and regulatory laws.

The latest move comes on the heels of the greenhouse gas legislations adopted by the federal authorities and positive market dynamics for renewables. Given the increasing awareness of the pitfalls of coal, electricity generation from renewables is projected to rise to 16% by 2040 from 13% in 2011 as per Energy Information Administration’s prediction, Westar Energy’s decision looks well timed in terms of its future growth objectives.

The proposed green energy additions will also provide an impetus to the company’s RENEW program, allowing customers to receive electricity at cost-effective rates. Nevertheless, renewables will likely confront stiff competition from abundant coal and natural gas sources in the energy race.

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today.

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros.  In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros.

Get the full Report on ABX - FREE

Get the full Report on GFI - FREE

Get the full Report on GG - FREE

Get the full Report on NEM - FREE

Get the full Report on WR - FREE

Follow us on Twitter: http://twitter.com/zacksresearch

Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts

Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.

Media Contact
Zacks Investment Research

800-767-3771 ext. 9339

support@zacks.com

http://www.zacks.com

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Read the analyst report on ABX

Read the analyst report on GFI

Read the analyst report on GG

Read the analyst report on NEM

Read the analyst report on WR

Zacks Investment Research



More From Zacks.com
View Comments