Agnico (AEM) Soars 5.1%: Is Further Upside Left in the Stock?
Agnico Eagle Mines (AEM) shares rallied 5.1% in the last trading session to close at $47.74. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 11.3% loss over the past four weeks.
AEM’s rally appears to reflect the surge in gold prices as the collapse of the Silicon Valley Bank led skittish investors flock to safe havens. The bank failure triggered expectations of less-aggressive Federal Reserve rate hikes and led to the significant weakening of the U.S. dollar, sending the yellow metal’s prices to six-week highs.
This gold mining company is expected to post quarterly earnings of $0.39 per share in its upcoming report, which represents a year-over-year change of -36.1%. Revenues are expected to be $1.3 billion, down 1.9% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Agnico, the consensus EPS estimate for the quarter has been revised 26% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on AEM going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Agnico is part of the Zacks Mining - Gold industry. TRX Gold (TRX), another stock in the same industry, closed the last trading session 9.8% higher at $0.45. TRX has returned -5.5% in the past month.
For TRX Gold , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.01. This represents a change of +200% from what the company reported a year ago. TRX Gold currently has a Zacks Rank of #2 (Buy).
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