Claude Laprise
It's been a much slower year for M&A after a hectic 18 months, from Q1 2020 to Q4 2021. However, the sharp pullback in the sector that has suppressed valuations for some companies has led to the extinguishment of the Gold
Agnico Eagle: Another Smart Move
Summary
- Agnico Eagle is one of the best-performing senior gold producers this year, but it isn't resting on its laurels, despite just coming off a mega-merger.
- Instead, the company has entered into a creative deal to acquire Yamana Gold's Canadian assets, with the bulk of the deal in cash and minimal share dilution (~8%).
- Notably, this deal is precisely in line with Agnico's strategy of growing its production and reserves in mining-friendly jurisdictions and focusing on high-quality assets.
- I see this deal as very positive, and it's being done at a fair price, which will ultimately lead to further growth in production, reserves, cash flow, and net asset value per share, which continues to make AEM a superior alternative to the metal.
Taylor Dart is an individual investor with over 16 years of trading experience, with his primary focus being precious metals developers, producers and royalty/streaming companies.
Taylor leads the investing group Alluvial Gold Research, where he offers portfolios with entry/exit points, Buy/Sell alerts, and proprietary sentiment indicators for gold and silver miners. Learn more.
- Disclosure: I am not a financial advisor. All articles are my opinion - they are not suggestions to buy or sell any securities. Perform your own due diligence and consult a financial professional before trading or investing.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of AEM, GOLD, IAUX either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Disclaimer: Taylor Dart is not a Registered Investment Advisor or Financial Planner. This writing is for informational purposes only. It does not constitute an offer to sell, a solicitation to buy, or a recommendation regarding any securities transaction. The information contained in this writing should not be construed as financial or investment advice on any subject matter. Taylor Dart expressly disclaims all liability in respect to actions taken based on any or all of the information on this writing. Given the volatility in the precious metals sector, position sizing is critical, so when buying small-cap precious metals stocks, position sizes should be limited to 5% or less of one's portfolio.
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