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Eldorado Gold and Malibu Boats have been highlighted as Zacks Bull and Bear of the Day
Read MoreHide Full Article
For Immediate Release
Chicago, IL – September 11, 2024 – Zacks Equity Research shares Eldorado Gold Corp. (EGO - Free Report) as the Bull of the Day and Malibu Boats, Inc. (MBUU - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Super Micro Computer, Inc. (SMCI - Free Report) , NVIDIA Corp. (NVDA - Free Report) and Dell Technologies Inc. (DELL - Free Report) .
Eldorado Gold Corp. is riding the highs of record gold prices in 2024. This Zacks Rank #1 (Strong Buy) is expected to grow earnings by the triple digits in 2024.
Eldorado Gold is a gold and base metals producer with mining, development and exploration operations in Turkiye, Canada and Greece. Headquartered in Vancouver, Canada, it has a market cap of $3.3 billion.
Another Beat in the Second Quarter of 2024
On July 25, 2024, Eldorado Gold reported its second quarter 2024 results and beat on the Zacks Consensus by $0.07. Earnings were $0.33 versus the consensus of $0.26.
It was Eldorado Gold's 7th consecutive earnings beat.
Gold production was in line with the company's expectations for the quarter at 122,319 ounces. That was an increase of 12% from the prior year's quarter due to a 22% increase in production at Lamaque and 14% at Kisladaq. Production was slightly offset by lower production at Olympias due to intermittent work stoppages during ongoing negotiations for a new collective bargaining agreement.
Gold sales of 121,226 ounces were at an average realized gold price per ounce sold of $2,336. Gold sales rose 10% from the year ago period primarily due to the increased production at Lamaque and Kisladaq.
Production costs rose to $127.8 million from $116.1 million due to higher sales volumes as well as slightly higher cash costs.
Maintained its Production and Cost Outlook for 2024
Eldorado Gold still expects to produce 505,000 to 555,000 ounces of gold this year. Production continues to be weighted to the second half of the year.
Total cash costs are still expected to be between $840 and $940 per ounce sold and an average all-in sustaining costs (AISC) of $1,190 to $1,290 per ounce sold.
Analysts Are Bullish on 2024
With gold hitting new highs, and Eldorado Gold reaffirming its 2024 production, the analysts are bullish.
5 earnings estimates have been raised for 2024 in the last 60 days pushing up the Zacks Consensus to $1.35 from $1.09 in that period. It made just $0.57 last year so that is earnings growth of 136.8%.
But while 3 earnings estimates have also been revised higher for 2025, the consensus is only looking for $1.28 which is a decline of 4.9%.
It's still early to be looking at 2025, however.
Here's what it looks like on the price and consensus chart. This is what investors want to see: an earnings consensus that is going up and to the right.
Shares Bust Out to New 5-Year Highs
Shares of Eldorado Gold have rallied this year and have surged to new 5-year highs. But over those 5 years, the shares have also beat the return on gold itself.
Eldorado Gold is still cheap, even after the rally. With earnings on the rise, it has a forward P/E of just 11.9.
Unlike some other gold producers, however, Eldorado does not pay a dividend.
Zacks only has two #1 Rank (Strong Buy) stocks in the gold mining industry right now. Eldorado Gold is one of the two.
For investors looking for a mid-cap gold miner, Eldorado Gold should be on your short list.
Malibu Boats, Inc. is navigating choppy waters as consumer demand for boats remains soft. This Zacks Rank #5 (Strong Sell) is riding out the slowdown while preparing for normalization.
Malibu Boats is a designer and manufacturer of recreational powerboats, including performance sport, sterndrive, and outboard boats.
It’s brands include Malibu and Axis in sport boats, Cobalt in sterndrive boats, Pursuit and Cobia in saltwater fishing boat market and the Pathfinder, Maverick and Hewes flats and bay boat brands.
A Rare Earnings Miss in the Fiscal Fourth Quarter
On Aug 29, 2024, Malibu Boats reported its fiscal fourth quarter 2024 results. It reported a loss of $0.39 versus the Zacks Consensus of a loss of $0.31.
It was, however, the first earnings miss by Malibu Boats in the last 5 years. That was an incredible earnings surprise track record given everything that had happened during the pandemic and after.
Sales were down 57.4% to $158.7 million from $213.6 million in the same quarter last year due to lower wholesale shipments driven by lower retail activity during the period. In other words, consumers were buying fewer boats.
Sales were down in all segments and promotional costs were higher.
Unit volume for the quarter fell 59% to 1,405 units from 2,550 units a year ago as retail sales slowed and channel inventory remained elevated.
For the full year, it was much the same. Sales were down 40.3% from fiscal 2023 to $829 million.
Unit volume for fiscal 2024 fell 45.4% to 5,385 units.
“Despite a softened retail demand environment, we are pleased with our execution as we closed out the fiscal fourth quarter,” said Bruce Beckman, Chief Financial Officer.
“We generated positive cash flow, paid down our remaining debt and returned cash to shareholders. We also made significant progress returning inventory to more normalized levels while upgrading our dealer network,” he added.
Analysts Bearish on Fiscal 2025
Despite some of the positives as Malibu Boats closed out fiscal 2024, the industry is simply waiting for normalization of the market.
Malibu Boats gave sales guidance in the low single digits for fiscal 2025. The Zacks Consensus has sales up just 1.8% to $843.7 million from $829 million in fiscal 2024.
The analysts are bearish on earnings. 3 estimates have been cut in the last 30 days for fiscal 2025 which has pushed the Zacks Consensus down to $2.26 from $3.17.
However, that’s still earnings growth of 17.7% compared to fiscal 2024’s earnings of $1.92.
Malibu Boats Shares Struggle as Boat Sales Remain Depressed
Boat sales soared during the pandemic as everyone took to the outdoors. Shares of Malibu Boats soared as well.
But over the last 5-years, it is now under performing the S&P 500 and is at multi-year lows.
Malibu Boats trades with a forward P/E of 15.8. While that’s considered cheap, with the earnings estimates being cut, it could be a value trap.
Investors might want to wait on the sidelines until earnings, and sales, finally start to turn around.
Additional content:
Post Hindenburg Report: Buy, Hold or Sell SMCI Stock?
Super Micro Computer, Inc.’s shares have seen a meteoric rise over the past three financial years due to increased demand for artificial intelligence (AI) chips. At the beginning of the year, the SMCI stock even outperformed Wall Street darling semiconductor stock NVIDIA Corp., which helped Super Micro get a position in the S&P 500 index in mid-March.
Super Micro’s success story, however, came to a standstill, thanks to a bearish short-seller report. The SMCI stock slipped more than 20% since the short report in late August. The SMCI stock did make a comeback on Monday’s trading session but continues to trade 68% below its all-time high, valuing the company at a market capitalization of $24 billion. So, at the moment, should investors sell the SMCI stock or buy the dip? Let’s have a look –
SMCI Stock – Short Seller Claims Accounting Irregularities
Hindenburg Research LLC, an investment research organization, claimed that Super Micro is involved in accounting manipulation. The research firm also alleged that Super Micro is involved in undisclosed third-party transactions and responsible for export control failures.
Hindenburg Research analyzed Super Micro’s litigation records for three months and interviewed several of the company’s employees. The research firm’s investigation compelled Super Micro to delay the annual 10-K filing with the Securities and Exchange Commission.
There is No Concrete Reason to Sell the SMCI Stock
Hindenburg Research has issued a short report. So, the investment firm must have the intention to push the price of the SMCI stock downward and allow its associated investors to gain from the drop. These investors are betting on the price of the SMCI stock to decrease, only to buy them later at a bargain. Thus, the report could be biased.
Super Micro, on the other hand, has called the short seller’s report inaccurate and a misrepresentation of facts. Super Micro expects to complete the 10-K filing with minor performance changes at the earliest. Therefore, there isn’t any solid reason to be bearish on the SMCI stock.
Is the SMCI Stock Worth Buying Now?
Super Micro’s AI servers are required to mount AI chips. The ever-growing AI chip market, thus, would help the SMCI stock to scale upward in the long run. According to Allied Market Research, the thriving AI-chip market is projected to register a CAGR of 38.2% from 2023 to 2032, to $383.7 billion by 2032.
Super Micro has room to expand its business in the ever-expanding AI server market. Super Micro accounts for only 10% of the AI server market share and is giving stiff competition to reputable players like Dell Technologies Inc.. Global Market Insights added that the AI server market is estimated to notch a CAGR of 18% or more from 2024 to 2032.
Super Micro, meanwhile, has generated profits proficiently. This is because the SMCI stock’s return on equity (ROE) is 34%, much higher than the Computer- Storage Devices industry’s 6.5%. Any ROE above 20% is generally considered to be very strong.
Super Micro’s current-year earnings outlook also looks promising, banking on the increase in demand for graphic processing units and rack-scale solutions needed for AI applications. As a result, the $33.50 Zacks Consensus Estimate for SMCI’s earnings per share is up 86.3% year over year.
What’s more, the SMCI stock is currently trading at a discount. Per the price/earnings ratio, SMCI presently trades at 13.5X forward earnings. But the industry’s forward earnings multiple is 14.4X.
Thus, attractive valuation and sheer dominance in the AI field should entice one to place bets on the SMCI stock.
Before Buying the SMCI Stock, Consider This
Despite the growth drivers, investors should mull over Super Micro’s concerns regarding cash burn and margin pressures. To achieve its ambitious revenue target, Super Micro needs to spend a lot in free cash flow, which might impact its solvency.
To provide AI server and rack solutions, a lot of working capital is also required, and that may impact Super Micro’s gross margins. So, investors can wait and watch for more reassuring developments in these critical areas before buying the SMCI stock.
The SMCI stock currently has a Zacks Rank #3 (Hold).
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index.Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Eldorado Gold and Malibu Boats have been highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – September 11, 2024 – Zacks Equity Research shares Eldorado Gold Corp. (EGO - Free Report) as the Bull of the Day and Malibu Boats, Inc. (MBUU - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Super Micro Computer, Inc. (SMCI - Free Report) , NVIDIA Corp. (NVDA - Free Report) and Dell Technologies Inc. (DELL - Free Report) .
Here is a synopsis of all three stocks.
Bull of the Day:
Eldorado Gold Corp. is riding the highs of record gold prices in 2024. This Zacks Rank #1 (Strong Buy) is expected to grow earnings by the triple digits in 2024.
Eldorado Gold is a gold and base metals producer with mining, development and exploration operations in Turkiye, Canada and Greece. Headquartered in Vancouver, Canada, it has a market cap of $3.3 billion.
Another Beat in the Second Quarter of 2024
On July 25, 2024, Eldorado Gold reported its second quarter 2024 results and beat on the Zacks Consensus by $0.07. Earnings were $0.33 versus the consensus of $0.26.
It was Eldorado Gold's 7th consecutive earnings beat.
Gold production was in line with the company's expectations for the quarter at 122,319 ounces. That was an increase of 12% from the prior year's quarter due to a 22% increase in production at Lamaque and 14% at Kisladaq. Production was slightly offset by lower production at Olympias due to intermittent work stoppages during ongoing negotiations for a new collective bargaining agreement.
Gold sales of 121,226 ounces were at an average realized gold price per ounce sold of $2,336. Gold sales rose 10% from the year ago period primarily due to the increased production at Lamaque and Kisladaq.
Production costs rose to $127.8 million from $116.1 million due to higher sales volumes as well as slightly higher cash costs.
Maintained its Production and Cost Outlook for 2024
Eldorado Gold still expects to produce 505,000 to 555,000 ounces of gold this year. Production continues to be weighted to the second half of the year.
Total cash costs are still expected to be between $840 and $940 per ounce sold and an average all-in sustaining costs (AISC) of $1,190 to $1,290 per ounce sold.
Analysts Are Bullish on 2024
With gold hitting new highs, and Eldorado Gold reaffirming its 2024 production, the analysts are bullish.
5 earnings estimates have been raised for 2024 in the last 60 days pushing up the Zacks Consensus to $1.35 from $1.09 in that period. It made just $0.57 last year so that is earnings growth of 136.8%.
But while 3 earnings estimates have also been revised higher for 2025, the consensus is only looking for $1.28 which is a decline of 4.9%.
It's still early to be looking at 2025, however.
Here's what it looks like on the price and consensus chart. This is what investors want to see: an earnings consensus that is going up and to the right.
Shares Bust Out to New 5-Year Highs
Shares of Eldorado Gold have rallied this year and have surged to new 5-year highs. But over those 5 years, the shares have also beat the return on gold itself.
Eldorado Gold is still cheap, even after the rally. With earnings on the rise, it has a forward P/E of just 11.9.
Unlike some other gold producers, however, Eldorado does not pay a dividend.
Zacks only has two #1 Rank (Strong Buy) stocks in the gold mining industry right now. Eldorado Gold is one of the two.
For investors looking for a mid-cap gold miner, Eldorado Gold should be on your short list.
Bear of the Day:
Malibu Boats, Inc. is navigating choppy waters as consumer demand for boats remains soft. This Zacks Rank #5 (Strong Sell) is riding out the slowdown while preparing for normalization.
Malibu Boats is a designer and manufacturer of recreational powerboats, including performance sport, sterndrive, and outboard boats.
It’s brands include Malibu and Axis in sport boats, Cobalt in sterndrive boats, Pursuit and Cobia in saltwater fishing boat market and the Pathfinder, Maverick and Hewes flats and bay boat brands.
A Rare Earnings Miss in the Fiscal Fourth Quarter
On Aug 29, 2024, Malibu Boats reported its fiscal fourth quarter 2024 results. It reported a loss of $0.39 versus the Zacks Consensus of a loss of $0.31.
It was, however, the first earnings miss by Malibu Boats in the last 5 years. That was an incredible earnings surprise track record given everything that had happened during the pandemic and after.
Sales were down 57.4% to $158.7 million from $213.6 million in the same quarter last year due to lower wholesale shipments driven by lower retail activity during the period. In other words, consumers were buying fewer boats.
Sales were down in all segments and promotional costs were higher.
Unit volume for the quarter fell 59% to 1,405 units from 2,550 units a year ago as retail sales slowed and channel inventory remained elevated.
For the full year, it was much the same. Sales were down 40.3% from fiscal 2023 to $829 million.
Unit volume for fiscal 2024 fell 45.4% to 5,385 units.
“Despite a softened retail demand environment, we are pleased with our execution as we closed out the fiscal fourth quarter,” said Bruce Beckman, Chief Financial Officer.
“We generated positive cash flow, paid down our remaining debt and returned cash to shareholders. We also made significant progress returning inventory to more normalized levels while upgrading our dealer network,” he added.
Analysts Bearish on Fiscal 2025
Despite some of the positives as Malibu Boats closed out fiscal 2024, the industry is simply waiting for normalization of the market.
Malibu Boats gave sales guidance in the low single digits for fiscal 2025. The Zacks Consensus has sales up just 1.8% to $843.7 million from $829 million in fiscal 2024.
The analysts are bearish on earnings. 3 estimates have been cut in the last 30 days for fiscal 2025 which has pushed the Zacks Consensus down to $2.26 from $3.17.
However, that’s still earnings growth of 17.7% compared to fiscal 2024’s earnings of $1.92.
Malibu Boats Shares Struggle as Boat Sales Remain Depressed
Boat sales soared during the pandemic as everyone took to the outdoors. Shares of Malibu Boats soared as well.
But over the last 5-years, it is now under performing the S&P 500 and is at multi-year lows.
Malibu Boats trades with a forward P/E of 15.8. While that’s considered cheap, with the earnings estimates being cut, it could be a value trap.
Investors might want to wait on the sidelines until earnings, and sales, finally start to turn around.
Additional content:
Post Hindenburg Report: Buy, Hold or Sell SMCI Stock?
Super Micro Computer, Inc.’s shares have seen a meteoric rise over the past three financial years due to increased demand for artificial intelligence (AI) chips. At the beginning of the year, the SMCI stock even outperformed Wall Street darling semiconductor stock NVIDIA Corp., which helped Super Micro get a position in the S&P 500 index in mid-March.
Super Micro’s success story, however, came to a standstill, thanks to a bearish short-seller report. The SMCI stock slipped more than 20% since the short report in late August. The SMCI stock did make a comeback on Monday’s trading session but continues to trade 68% below its all-time high, valuing the company at a market capitalization of $24 billion. So, at the moment, should investors sell the SMCI stock or buy the dip? Let’s have a look –
SMCI Stock – Short Seller Claims Accounting Irregularities
Hindenburg Research LLC, an investment research organization, claimed that Super Micro is involved in accounting manipulation. The research firm also alleged that Super Micro is involved in undisclosed third-party transactions and responsible for export control failures.
Hindenburg Research analyzed Super Micro’s litigation records for three months and interviewed several of the company’s employees. The research firm’s investigation compelled Super Micro to delay the annual 10-K filing with the Securities and Exchange Commission.
There is No Concrete Reason to Sell the SMCI Stock
Hindenburg Research has issued a short report. So, the investment firm must have the intention to push the price of the SMCI stock downward and allow its associated investors to gain from the drop. These investors are betting on the price of the SMCI stock to decrease, only to buy them later at a bargain. Thus, the report could be biased.
Super Micro, on the other hand, has called the short seller’s report inaccurate and a misrepresentation of facts. Super Micro expects to complete the 10-K filing with minor performance changes at the earliest. Therefore, there isn’t any solid reason to be bearish on the SMCI stock.
Is the SMCI Stock Worth Buying Now?
Super Micro’s AI servers are required to mount AI chips. The ever-growing AI chip market, thus, would help the SMCI stock to scale upward in the long run. According to Allied Market Research, the thriving AI-chip market is projected to register a CAGR of 38.2% from 2023 to 2032, to $383.7 billion by 2032.
Super Micro has room to expand its business in the ever-expanding AI server market. Super Micro accounts for only 10% of the AI server market share and is giving stiff competition to reputable players like Dell Technologies Inc.. Global Market Insights added that the AI server market is estimated to notch a CAGR of 18% or more from 2024 to 2032.
Super Micro, meanwhile, has generated profits proficiently. This is because the SMCI stock’s return on equity (ROE) is 34%, much higher than the Computer- Storage Devices industry’s 6.5%. Any ROE above 20% is generally considered to be very strong.
Super Micro’s current-year earnings outlook also looks promising, banking on the increase in demand for graphic processing units and rack-scale solutions needed for AI applications. As a result, the $33.50 Zacks Consensus Estimate for SMCI’s earnings per share is up 86.3% year over year.
What’s more, the SMCI stock is currently trading at a discount. Per the price/earnings ratio, SMCI presently trades at 13.5X forward earnings. But the industry’s forward earnings multiple is 14.4X.
Thus, attractive valuation and sheer dominance in the AI field should entice one to place bets on the SMCI stock.
Before Buying the SMCI Stock, Consider This
Despite the growth drivers, investors should mull over Super Micro’s concerns regarding cash burn and margin pressures. To achieve its ambitious revenue target, Super Micro needs to spend a lot in free cash flow, which might impact its solvency.
To provide AI server and rack solutions, a lot of working capital is also required, and that may impact Super Micro’s gross margins. So, investors can wait and watch for more reassuring developments in these critical areas before buying the SMCI stock.
The SMCI stock currently has a Zacks Rank #3 (Hold).
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
https://www.zacks.com
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index.Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.