After what was considered to be relatively flat week for precious metals traders, all eyes are on Europe this week as the IMF is due out with a report that will determine how much funding Spain will receive to revive its financial industries sector. Friday's precious metal trading session ended mixed as investors are waiting on several key announcements in the coming week. Gold was up $3.40 to close at $1591.40 per ounce and silver fell just $0.06 to close at $28.47 per ounce.
The second quarter could equate to some positivity in the sector as these four companies look to surpass analysts' estimates and both the SPDR Gold Trust (GLD) and iShares Silver Trust (SLV) look to demonstrate gains for the remainder of the year. Both the GLD and SLV have been flat thus far this year.
Barrick Gold (ABX) - Founded in 1983, and based in Toronto, Ontario, Canada, ABX currently trades in a 52-week range of $34.82/share (52-week low) and $55.95/share (52-week high). Analysts expect ABX to earn $1.05/share for the second quarter on revenue of $3.65 billion dollars and earn $4.75/share on revenue of $15.52 billion for the year.
The last two quarters have seen earnings misses for ABX and the upcoming quarter could equate to the same results. I believe the estimates of $1.05/share are a bit too high and actual earnings may even come in as low as $0.98/share on revenue of just above $3.5 billion dollars. The good news is ABX has made some big changes to its management team and the company began to see a positive turnaround as early as the third quarter. I'd actually wait to establish a position in ABX until after the company reports earnings for the June quarter.
Yamana Gold (AUY) - Founded in 2003 and based in Toronto, Ontario, Canada, AUY currently trades in a 52-week range of $11.10/share (52-week low) and $18.16/share (52-week high). Analysts expect AUY to earn $0.26/share for the second quarter on revenue of $618.54 million dollars and earn $1.11/share on revenue of $2.52 billion for the year.
Yamana has seen a pretty good run over the last four quarters as it has beaten street estimates by an average of 17.73% over that period. The stock is currently trading in the middle of its 52-week range and is very affordable considering its recent P/E ratio 20.76. The company has also been seen as very profitable, as recently noted by Jeff Williams. Williams stated that the company's 2011 'Quality of Earnings' comes in very good as Operating Cash Flow exceeds Net Income.
Endeavour Silver (EXK) - Founded in 1981, and based in Vancouver, British Colombia Canada, EXK currently trades in a 52-week range of $7.25/share (52-week low) and $13.10/share (52-week high). Analysts expect EXK to earn $0.13/share for the second quarter and earn $0.86/share on revenue of $262.92 billion for the year.
One of the keys to profitability for EXK is the company's continued success in terms of production. The year 2012 would mark the eighth consecutive year that the company has increased production and both Guanajato and Guanacevi have delivered very good results for the company. The first quarter demonstrated a bright spot in terms of EPS for the company as it beat estimates by 37.5%, marking the end of three very disappointing quarters. EXK currently trades at a P/E ratio of 22.48, which makes the stock very attractive at these levels, and also a point where potential investors should establish a small position.
Coeur d'Alene Mines Corp. (CDE) - Founded in 1928, and based in Coeur d'Alene, Iowa, CDE currently trades in a 52-week range of $16.21/share (52-week low) and $30.99/share (52-week high). Analysts expect CDE to earn $0.34/share for the second quarter on revenue of $226.5 million dollars and earn $1.70/share on revenue of $985.18 million for the year.
The last two quarters have been very good as CDE has surpassed analysts' estimates by an average of 22.9% or $0.07/share. The good news is CDE expects to produce between 18.5 million and 20 million ounces of silver and 210,000 to 230,000 ounces of gold, the bad news is if the company misses on either number, the stock may see a short-term sell-off. For investors looking to establish a position in CDE, now would be a great time to establish a small position and see if the company can surpass estimates for the third straight quarter. If they are able to post solid earnings then I would increase my position moderately.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.