Mining Stocks:- We has identified five gold and copper mining stocks with strong buy ratings and solid earnings growth potential, offering indirect exposure to commodity prices and potential upside for investors with risk appetite.
Kinross Gold Corporation (KGC)
Market Capitalization: $9.68B
Rating: Strong Buy
Sector Ranking (as of 6/27/24): 8 out of 280
Industry Ranking (as of 6/27/24): 4 out of 44
Kinross Gold Corporation, a Toronto-based gold miner, has seen a 70% increase in its stock price over the past year, outperforming the market and industry peers.
KGC’s Q124 earnings surprised investors with a $0.10 EPS and $1.08B revenue, beating $40M YoY. The company expects 2.1Moz of production in FY24, with a $1.0B capex investment and $550M allocated to expansion projects. KGC’s proven mineral reserves include 22.7Moz gold and 23.6Moz silver.
Agnico Eagle Mines Limited (AEM)
Market Capitalization: $32.63B
Rating: Strong Buy
Sector Ranking (as of 6/27/24): 13 out of 280
Industry Ranking (as of 6/27/24): 6 out of 44
Agnico Eagle Mines, a gold mining company, experienced a 30% increase in Q1 and a 20% YoY increase YoY. The company’s Q124 Non-GAAP EPS was $0.76, and revenue was $1.83B (+21.2% YoY). AEM’s Q124 gold output was 878.6Koz, with 80% coming from Canada. AEM expects to produce 3.45Moz of gold in FY24.
AEM’s profitability is ‘A’, with a 56% TTM, 48% EBITDA, and 15% levered FCF margin, and a 23% capex/sales ratio.
AEM experienced a +17% YoY sales growth, a 23% EBITDA growth, and a 66% levered FCF growth rate. However, its overall growth factor grade is a ‘C-‘ due to negative EPS growth. FY24 EPS is projected to grow 46% and revenue +17%.
Eldorado Gold Corporation (EGO)
Market Capitalization: $3.01B
Rating: Strong Buy
Sector Ranking (as of 6/27/24): 21 out of 280
Industry Ranking (as of 6/27/24): 8 out of 44
Eldorado Gold Corporation, a Vancouver-based gold miner, experienced a 50% increase in Q124 gold equivalent production, with operations in Canada, Turkey, and Greece. The company’s Q124 EPS beat $0.13, and revenue reached $257.97M. EGO’s A+ growth grade is supported by a 35% YoY EBITDA growth and a 40% YoY EPS growth.
EGO’s profitability grade is C-, with a 45% capex/sales TTM ratio. Total capital expenditures in Q1 were $122M, including $52.5M in Skouries. EGO’s gross profit margin is over 50%, EBITDA margin is 43%, and net income margin is 11%. EGO’s valuation grade is ‘C’, with a projected FY24 EPS growth of over 100%.
Lundin Mining Corporation (OTCPK:LUNMF)
Market Capitalization: $8.62B
Rating: Strong Buy
Sector Ranking (as of 6/27/24): 22 out of 280
Quant Industry Ranking (as of 6/27/24): 2 out of 7
Lundin, a Vancouver-based mining company, has seen a 30% YoY increase in its Q124 revenue of $937M, with 75% coming from copper. The company’s revenue is primarily derived from Chile’s Cerones and Candelaria operations. Lundin’s Josemaria project in Argentina is still in development, with proven and probable mineral reserves of 10.63Mt of copper, 12Moz of gold, 157Moz of silver, 2.5Mt of zinc, and 51Kt of nickel.
Lundin’s Q124 EPS was $0.06, with a revenue of $937M, beating estimates by $16.64M. The company’s A+ growth grade is driven by a 27% YoY revenue growth and a +51% EBITDA growth. Lundin’s valuation is B+, with a PEG FWD ratio of 0.16 and EV/EBITDA FWD of 5.94x. The company offers a dividend yield of 2.39% and a 24% 5Y growth rate.
Fortuna Silver Mines Inc. (FSM)
Market Capitalization: $1.49B
Rating: Strong Buy
Sector Ranking (as of 6/27/24): 7 out of 280
Industry Ranking (as of 6/27/24): 1 out of 9
FSM, a Vancouver-based precious metals miner, experienced a 54% increase in Q1 2021, ranking #1 among quant-rated silver stocks. Despite 80% of Q124 revenue coming from gold, FSM’s revenue soared 28%, reaching $224.9M, with gold production increasing by 50%.
FSM’s revenue grew 32% YoY, EBITDA increased by 48%, and levered FCF by 470%, resulting in a B+ growth rate and a B+ valuation. FSM’s FY24 EPS is projected to grow 57% to $0.39.
Gold and copper mining stocks surged in 2024 due to record high commodity prices. Central bank demand and cost stabilization could boost gold miners, while global energy transition requirements could benefit copper miners. Five Strong Buy mining stocks showed strong momentum and earnings growth potential.