43.45 +0.18 (0.41%)
After hours: 4:10PM EDT
|Bid||43.01 x 300|
|Ask||44.10 x 100|
|Day's Range||42.81 - 43.73|
|52 Week Range||37.35 - 51.86|
|PE Ratio (TTM)||41.23|
|Earnings Date||Feb 8, 2017 - Feb 13, 2017|
|Forward Dividend & Yield||0.44 (1.01%)|
|1y Target Est||52.66|
Gold stocks likely to ride on the back of the improving gold industry and put up a decent performance this quarter, as they report on Apr 26.
Yamana Gold’s (AUY) stock has also underperformed the gold miners’ index (GDX) year-to-date by returning -6.6% as of April 17. AUY’s 4Q17 results disappointed, with the company reporting earnings far below analysts’ expectations. Its EPS (earnings per share) were -$0.20, below analysts’ estimate of $0.03. The major factor driving the loss was a $356 million non-cash impairment charge related to the remeasurement of its Gualcamayo mine and related expansion projects in Argentina. Investors are wary of Yamana’s inconsistent operational results.
Barrick Gold (ABX) generated negative returns amounting to 9.7% year-to-date (or YTD) as of April 17. The stock has significantly underperformed its close peers Goldcorp (GG), Newmont Mining (NEM), and Agnico Eagle Mines (AEM), which returned 12.5%, 10.9%, and -1.9%, respectively. The VanEck Vectors Gold Miners ETF (GDX) returned -1.5%.
Investors are typically interested in gold mining companies’ (GDX)(GDXJ) ability to generate FCF (free cash flow) because FCF helps them invest in future growth—apart from the aim of returning cash to shareholders.
TORONTO , April 20, 2018 /CNW/ - Agnico Eagle Mines Limited (NYSE: AEM, TSX: AEM) ("Agnico Eagle" or the "Company") announced today that it has disposed of 44,551,000 common shares of Belo Sun Mining Corp. ("Belo Sun") in a pre-arranged trade executed through the facilities of the Toronto Stock Exchange (the "TSX"). The sale price was C$0.335 per common share (the 30-day volume weighted average price of the common shares of Belo Sun on the TSX at the time of the trade), for aggregate proceeds of C$14,924,585 . The Company reviews its portfolio of equity investments in junior mining companies on an ongoing basis. The Company completed the disposition in order to monetize a non-core asset held in its portfolio.
The recent unrest in the markets has had a significant effect on precious metals and mining companies. The US dollar has a prominent role in influencing dollar-denominated precious metals and mining stocks.
Analyst estimates for gold miners’ (GDX) revenues can give us a good idea about their outlook on gold prices (GLD) as well as companies’ production growth. In this part of our series, we’ll assess analysts’ revenue expectations for gold companies in 1Q18 and beyond. Analysts expect Barrick Gold (ABX) to generate revenues of ~$1.84 billion in 1Q18.
On one hand, it has increased US growth projections due to the stimulus from tax cuts. Since these tax cuts are unfunded, the IMF believes that there will be a need for severe spending cuts in the coming years. It predicts that the US debt-to-GDP (gross domestic product) ratio will expand to 116.9% by 2023, surpassing Italy’s ratio, which should narrow to 116.6% by 2023.
At extreme levels, these ratings could even signal a change in direction, so it’s important for investors to track this data. In the senior and intermediate gold miner space (GDX)(GDXJ), analysts are the most bullish on Goldcorp (GG), assigning it 65% “buy” and 5% “sell” ratings.
Unrest in Syria played a role in precious metals rising on Friday, April 13. The day before, Donald Trump discussed how to address a recent Syrian poison gas attack. He threatened missile strikes, which were eventually carried out, on Saturday.
The Fed minutes from its policy meeting on March 20–21 were released on April 11, 2018. In the March meeting minutes, the FOMC (Federal Open Market Committee) staff review of the economy was stronger than the review presented at the January meeting. According to the minutes, all of the FOMC members expected 12-month inflation (TIP) to increase in the coming months.
The Bureau of Labor Statistics released US jobs data for March 2018 on April 6. The job growth was weaker than expected. The US added 103,000 jobs in March as compared to upwardly revised 326,000 jobs the previous month. The economists were expecting an addition of 185,000 jobs in March, as per Bloomberg. While a slowdown was expected in March due to February’s surge underpinned by hiring due to unseasonably warm weather, the decline was more than what the market expected. The unemployment rate has remained at 4.1% for six months. The Fed is forecasting a rate of 3.8% by the end of this year.
Another crucial factor that closely plays on precious metals prices is the US interest rate—more specifically, the Federal Reserve’s decisions on moving the interest rate. During the Fed’s meeting in the third week of March, it took a hawkish stance, causing precious metals to rise instead of fall. The Fed mentioned that it would like to raise interest rates two rather than three more times in 2018.
Usually, precious metals mining companies follow precious metals. When precious metals rose on April 11, 2018, miners followed suit. Most miners saw an up day on April 11, though that may not always be the case.
Yamana Gold (AUY) and Agnico Eagle Mines (AEM) also underperformed the Gold Miners Index (GDX) and gold (GLD) in 1Q18, falling 16.1% and 10.0%, respectively. However, their losses were smaller than those seen by intermediate peers Eldorado Gold (EGO) and New Gold (NGD), which fell 41.7% and 24.3%, respectively, mainly due to issues at several of their mines.
Barrick Gold (ABX) has underperformed senior and intermediate peers (GDX) (GDXJ) as well as the broader benchmark index (GDX). Barrick has guided for production of 4.5 million–5.0 million ounces of gold in 2018, which implies a ~11% fall from the midpoint of its actual production in 2017. Barrick Gold raised its all-in sustaining cost guidance for 2018 to $765–$815 per ounce.
Gold prices rose ~1% in 1Q18 after rising ~13% in 2017. Gold prices are being affected by a number of factors, including rate hike expectations, trade war fears, the US dollar, and increasing volatility.
The overall volatility in the markets has played a vital role in determining the directional move for precious metals. Gold and silver rose on Tuesday, April 10, 2018, possibly due to reports of a poison gas attack in Syria and the ongoing trade war fears between China and the United States. The equities market in Asia also lagged on Tuesday, which could have prompted some haven bids for precious metals. Often, gold is known to diverge from the broader stock markets.
The US dollar, depicted by the DXY Currency Index, was down 0.30% on Monday, April 9. The US dollar and gold tend to be inversely related to each other. The below chart shows the relationship between gold (IAU) (SLV) and the US dollar over the past one month.
Kinross Gold (KGC) stock fell 8.7% yesterday in reaction to the fresh US sanctions on entities in Russia (RSX). On April 6, 2018, the US Treasury Department announced new sanctions on a number of Russian security officials, politicians, and oligarchs believed to have close ties to Russian President Vladimir Putin. A senior official of the US Treasury Department maintained that sanctions were “in response to the totality of the Russian government’s ongoing and increasingly brazen pattern of malign activity around the world.” The broader Russian market and Russian ruble came under heavy selling.
SUDBURY, Ontario , April 9, 2018 /PRNewswire/ -- Rail-Veyor Technologies Global Inc. is proud to announce that its Rail-Veyor system is now hauling all the production material at Agnico Eagle Mines Limited's ...
The list of the biggest gold mining companies in the world includes many publicly-traded companies, which can be good investment opportunities for investors seeking to diversify their portfolio and get some exposure to the precious metal. Whether you want to invest in physical gold or one of the biggest gold mining companies in the world, […]
Newmont Mining (NEM) and Barrick Gold (ABX) are among the miners that mistimed their acquisitions to just before precious metal prices (GLD)(SLV) spiraled down. This led to the accumulation of excessive debt without any proportionate increase of earnings capacity. Newmont Mining has reduced its net debt by 83.0% since 2013.