Yesterday, 11:35 AM
Thu, Feb. 19, 5:55 PM
- Goldcorp (NYSE:GG) fell 8.4% today after missing Q4 earnings expectations and posting a huge impairment charge on one of its newest mines, which CEO Chuck Jeannes called "frustrating."
- In today's earnings conference call, the CEO said analysts seemed to expect sales from the Cerro Negro mine and another mine to be included in this quarter’s results, even though he had told them it would not happen.
- Jeannes said he is still positive about Cerro Negro despite the writedown, which came because of high inflation and import and currency restrictions in Argentina; the country has recovered from the sort of crisis it is now experiencing before, he said.
- Despite the disappointing report, analysts remain largely positive on the stock; a BMO analyst today described GG as "the preferred senior gold stock, offering strong production growth, reasonable balance sheet and healthy dividend yield."
Thu, Feb. 19, 10:26 AM
- Goldcorp (GG -3.2%) missed Q4 earnings and revenue expectations, as lower prices and higher costs offset a big jump in production.
- GG's unadjusted $2.4B loss in Q4 was mostly attributable to a $2.3B writedown on its Cerro Negro gold mine in Argentina, which achieved commercial production just after the end of Q4; GG previously had warned it could take a charge of up to $2.7B on the project.
- Q4 gold production totaled a record 890.9K oz., up from 768.9K oz. in the year-ago period, but all-in sustaining costs were much higher at $1,035/oz. from $810/oz. a year earlier.
- GG forecasts 2015 production to rise ~20% Y/Y to 3.3M-3.6M oz. and all-in sustaining costs of $875-$950/oz.; plans capital spending for the year at $1.2B-$1.4B.
- GG expects major contributions from its new operations at Cerro Negro, Eleonore and Cochenour (still in development); Eleonore reached production in October but produced only 18.3K oz. due to issues with a tailings filter press system that the company says have been resolved.
- Also announced proven and probable mineral reserves of 49.6M oz. of gold and 789M oz. of silver.
Thu, Feb. 19, 8:03 AM
Wed, Feb. 18, 5:30 PM| 7 Comments
Tue, Feb. 10, 11:38 AM
- Goldcorp (GG -1.1%) and Agnico Eagle Mines (AEM -1.7%) are highlighted as the two top picks in the gold mining sector at Credit Suisse.
- GG is the firm's preferred senior gold equity due to its growth profile, dividend yield, strong balance sheet and low debt level, and longer average mine life with strong exploration potential at key assets.
- AEM is a top pick because of its strong free cash flow outlook, operational track record and relatively de-risked 2015 outlook, but the firm is slightly cautious since the stock has been a top performer YTD and its valuation could now be reflecting better than analyst expectations on costs.
Mon, Feb. 9, 7:59 AM
- Tahoe Resources (NYSE:TAHO) agrees to acquire Rio Alto Mining (NYSE:RIOM) in a cash and stock deal valuing RIOM at ~C$1.4B ($1.12B), based on Friday's closing stock prices, in a bid to expand its presence in Latin America.
- RIOM shareholders would receive 0.227 of a TAHO share and $0.01 cash per share, making the offer worth ~C$4/share, a 22% premium to RIOM's C$3.28 closing price Friday on the Toronto Stock Exchange.
- TAHO controls the Escobal silver mine in Guatemala, while RIOM owns the La Arena gold mine and the Shahuindo gold project in Peru.
- Goldcorp (NYSE:GG) owns ~39% of TAHO shares and is supporting the deal.
Mon, Feb. 2, 5:07 PM
Tue, Jan. 27, 3:10 PM
- Gold miner (NYSEARCA:GDX) earnings reports are on the way, and Barclays analysts foresee Q4 earnings to come in lower across the board with margins under pressure as metals prices fall; for gold, they see producers’ margins falling ~12% Q/Q.
- Barclays believes lower gold prices also will mean writedowns of assets for many companies, while mining depletion will combine with limited exploration budgets to bring down reserves.
- Most senior and mid-tier gold producers will not see Y/Y production growth in 2015, the firm says; Goldcorp (GG +2.9%), Agnico Eagle Mines (AEM +4.6%), Yamana Gold (AUY +3.2%) and New Gold (NGD +4.2%) should enjoy production growth, while royalty companies Royal Gold (RGLD +1.8%) and Franco-Nevada (FNV +4.6%) should have revenue growth despite lower commodity pricing.
Mon, Jan. 19, 7:57 AM
- Goldcorp (NYSE:GG) has agreed to buy Probe Mines (OTCPK:PROBF) in an all-stock deal that values the metals exploration company at C$526M, in a bid to win control of the Borden Gold project in northern Ontario.
- The deal offers Probe shareholders a 49% premium to the company's Friday closing price of C$3.36/share.
Thu, Jan. 15, 12:35 PM
- Gold, silver, platinum and palladium are spiking today on Switzerland's surprise move to abandon its currency floor, and shares of the miners are following suit: GDX +6.1%.
- "Gold is much stronger as the 'safety' of the Swiss Franc vanishes,” commented Dave Lutz of JonesTrading.
- Peter Boockvar believes that in "a world of currency battles with printing presses that are extraordinarily large... gold will be the last man standing... the gold bear market is over and will go substantially higher from here."
- Against a backdrop of concerns about global growth, deflation and renewed volatility, gold has been climbing since November as other growth-sensitive commodities such as oil and copper have sold off.
- Among precious metals miners: BTG +9.5%, GG +8.9%, KGC +8.7%, NEM +8.3%, AUY +8.1%, EGO +7.4%, [AGI +7%, [ABX]] +6.2%, NG +5.9%, AUQ +5.6%, FNV +5.5%, RGLD +5.4%, IAG +4.8%, GFI +4.2%, HL +4.2%, SLW +3.1%.
- Other ETFs: NUGT, GDXJ, DUST, SIL, JNUG, GLDX, JDST, SLVP, SILJ, RING, SGDM, PLTM, PSAU
Wed, Jan. 14, 6:25 PM
- Goldcorp (NYSE:GG) could soon join a group of large gold miners that have a net loss to show for their entire history as corporate entities, Financial Post's Peter Koven writes.
- GG warned this week that it expects to record a $2.3B-$2.7B impairment charge on its Cerro Negro mine in Argentina; since the miner’s retained earnings were $2.2B as of Sept. 30, they may be completely wiped out in its next quarterly report.
- That's not unusual in the gold industry, where writedowns have destroyed historic profits in recent years: Barrick Gold (NYSE:ABX) has retained earnings of -$7.8B, Kinross Gold (NYSE:KGC) has -$8.5B in historic losses, AngloGold Ashanti (NYSE:AU) has -$4B, and Agnico Eagle Mines (NYSE:AEM) has a mere -$740M.
- The writedowns are non-cash and have no impact on day-to-day operations, but they have damaged the reputations of gold miners and drove away investors who have proven tough to woo back, Koven writes.
Mon, Jan. 12, 6:35 PM
- Coeur Mining (NYSE:CDE) agrees to acquire the Wharf gold mine in South Dakota from Goldcorp (NYSE:GG) for $105M, which CDE says provides quality, immediate growth and adds a stable, established source of production and cash flow to its existing portfolio.
- CDE expects Wharf to produce 85K-90K oz. of gold in 2015 at an all-in sustaining cost of $800-$875/oz. and increase its 2015 EBITDA by more than 30%.
Mon, Jan. 12, 6:22 PM
- Goldcorp (NYSE:GG) says it produced a record 886K oz. of gold during Q4, resulting in FY 2014 gold production of a record 2.87M oz., and sees FY 2015 production increasing ~20% to 3.3M-3.6M oz. of gold, in line with previous guidance.
- The miner says Q4 all-in sustaining costs were $1,045/oz. and $950/oz. for FY 2014, and forecasts 2015 all-in sustaining costs of $875-$950/oz.
- Forecasts 2015 capital spending decreasing to $1.2B-$1.4B.
- Says its Cerro Negro mine in Argentina began commercial production on Jan. 1, but expects to take a Q4 asset impairment charge of $2.3B-$2.7B on the mine due to the government's actions and programs aimed at conserving its foreign exchange reserves and the country's continuing inflation, which are hurting operations at the mine.
- GG -0.4% AH.
Mon, Jan. 12, 2:43 PM
- Goldcorp (GG +3.6%) is the top senior gold producer to own in 2015, analysts at BofA Merrill say, noting the strong Q4 gold production forecast and its expectation of healthy operating guidance for 2015.
- GG had reiterated its 2014 gold output guidance range of 2.95M oz. to 3.1M oz. in the prior quarter with a bias to the lower end, and all-in-sustaining-costs at the lower end of the $950-$1,000/oz. range; the firm also sees cash costs declining 10%-15% over the next several years.
- The company now trades at 1.49x its net asset value, or a ~8% premium to its peer North American gold producers, and the firm feels that delivering on GG’s high-quality growth pipeline would lead to a re-rating for the shares to a 25%-30% premium vs. peers.
Wed, Jan. 7, 11:58 AM
- Goldcorp (GG +0.5%) is likely to disappoint when it reports 2014 production results soon, according to RBC analyst Stephen Walker, whose Q4 projection of 920K oz. would leave the miner below its FY 2014 guidance.
- Q4 production must exceed 970K oz. to hit the low end of its guidance of 2.95M oz., the analyst says while noting some reasons why output could fall short: a slower than expected ramp-up at the Cerro Negro mine, a lower than expected rebound in gold grades at Penasquito, and a slow transition to high-grade zones at Red Lake.
- Nevertheless, Walker would buy shares on any weakness since he believes GG’s outlook for rising production and low costs over the next two years will remain intact; GG expects gold output to rise to as much as 4M oz. in 2016.
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