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Goldcorp (GG) Q1 Earnings Beat, Revenues Miss Estimates
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Goldcorp Inc. reported net earnings of $170 million or 20 cents per share for first-quarter 2017, compared with net earnings of $80 million or 10 cents per share a year ago. Earnings per share beat the Zacks Consensus Estimate of 9 cents.
Goldcorp recorded revenues of $882 million in the reported quarter, missing the Zacks Consensus Estimate of $930 million.
Gold sales slumped around 19.1% year over year to 646,000 ounces in the reported quarter and production tumbled 16.4% to 655,000 ounces.
All-in sustaining costs (AISC) were $800 per gold ounce (down 4.3% year over year). The decrease in AISC was attributable to Goldcorp’s focus on cost reduction with lower sustaining capital and corporate administration costs, increased realized prices of by-products at Penasquito, partly offset by lower sales volumes.
At the Penasquito mine, gold production was 138,000 ounces, marking an increase of 13.1% year over year. AISC was $391 per ounce compared with $1,004 in the year-ago quarter.
At the Cerro Negro in Argentina, gold production was 88,000 ounces, marking a decrease of 31.2% year over year. AISC was $651 per ounce compared with $503 in the year-ago quarter.
At the Pueblo Viejo mine, gold production was 95,000 ounces, marking a decrease of 15.2% year over year. AISC was $541 per ounce compared with $443 in the year-ago quarter.
Financial Position
As of Mar 31, 2017, Goldcorp had total liquidity of $3.1 billion, including $0.2 billion in short-term investments and cash and cash equivalents and $2.9 billion credit facility. The company reported adjusted operating cash flows of $269 million for the first quarter, of which $15 million was used to pay dividends, $74 million was used to fund growth pipeline and $65 million was used to repurchase gold stream on NuevaUnion project.
Outlook
According to President and CEO David Garofalo, the company remains focused on execution, cost reduction and optimization of asset portfolio. Goldcorp continues to improve the strongest growth pipeline. It has a planned joint venture in the Maricunga District in Chile, to produce 60 million ounces of gold, which will be financed by the sale of non-core assets. The deal is in line with the strategy of growing net asset value per share by delivering 3–4 million ounces of sustainable gold production from 6–8 core camps annually.
Price Performance
Goldcorp’s shares declined around 16.8% over the past three months underperforming the Zacks categorized Mining–Gold industry’s 7.7% loss.
Zacks Rank & Key Picks
Goldcorp currently carries a Zacks Rank #3 (Hold).
Kronos has an expected long-term earnings growth of 5%.
Nucor has an expected long-term earnings growth of 12%.
Univar has an expected long-term earnings growth of 9.4%.
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Goldcorp (GG) Q1 Earnings Beat, Revenues Miss Estimates
Goldcorp Inc. reported net earnings of $170 million or 20 cents per share for first-quarter 2017, compared with net earnings of $80 million or 10 cents per share a year ago. Earnings per share beat the Zacks Consensus Estimate of 9 cents.
Goldcorp recorded revenues of $882 million in the reported quarter, missing the Zacks Consensus Estimate of $930 million.
Gold sales slumped around 19.1% year over year to 646,000 ounces in the reported quarter and production tumbled 16.4% to 655,000 ounces.
All-in sustaining costs (AISC) were $800 per gold ounce (down 4.3% year over year). The decrease in AISC was attributable to Goldcorp’s focus on cost reduction with lower sustaining capital and corporate administration costs, increased realized prices of by-products at Penasquito, partly offset by lower sales volumes.
Goldcorp Inc. Price, Consensus and EPS Surprise
Goldcorp Inc. Price, Consensus and EPS Surprise | Goldcorp Inc. Quote
Mining Highlights
At the Penasquito mine, gold production was 138,000 ounces, marking an increase of 13.1% year over year. AISC was $391 per ounce compared with $1,004 in the year-ago quarter.
At the Cerro Negro in Argentina, gold production was 88,000 ounces, marking a decrease of 31.2% year over year. AISC was $651 per ounce compared with $503 in the year-ago quarter.
At the Pueblo Viejo mine, gold production was 95,000 ounces, marking a decrease of 15.2% year over year. AISC was $541 per ounce compared with $443 in the year-ago quarter.
Financial Position
As of Mar 31, 2017, Goldcorp had total liquidity of $3.1 billion, including $0.2 billion in short-term investments and cash and cash equivalents and $2.9 billion credit facility. The company reported adjusted operating cash flows of $269 million for the first quarter, of which $15 million was used to pay dividends, $74 million was used to fund growth pipeline and $65 million was used to repurchase gold stream on NuevaUnion project.
Outlook
According to President and CEO David Garofalo, the company remains focused on execution, cost reduction and optimization of asset portfolio. Goldcorp continues to improve the strongest growth pipeline. It has a planned joint venture in the Maricunga District in Chile, to produce 60 million ounces of gold, which will be financed by the sale of non-core assets. The deal is in line with the strategy of growing net asset value per share by delivering 3–4 million ounces of sustainable gold production from 6–8 core camps annually.
Price Performance
Goldcorp’s shares declined around 16.8% over the past three months underperforming the Zacks categorized Mining–Gold industry’s 7.7% loss.
Zacks Rank & Key Picks
Goldcorp currently carries a Zacks Rank #3 (Hold).
Better-ranked companies in the basic materials space include Kronos Worldwide Inc (KRO - Free Report) , Nucor Corp. (NUE - Free Report) and Univar Inc. . All the three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.
Kronos has an expected long-term earnings growth of 5%.
Nucor has an expected long-term earnings growth of 12%.
Univar has an expected long-term earnings growth of 9.4%.
5 Trades Could Profit "Big-League" from Trump Policies
If the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure. See these buy recommendations now >>