It has been about a month since the last earnings report for Goldcorp Inc. . Shares have lost about 13.2% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Goldcorp’s Q4 Earnings Beat, Revenues Miss Estimates
Goldcorp reported net earnings of $101 million or $0.12 per share for fourth-quarter 2016 compared with a net loss of $4.3 billion or $5.14 per share a year ago. Earnings per share beat the Zacks Consensus Estimate of $0.09.
Goldcorp posted revenues of $898 million in the reported quarter, down 16.2% year over year. Revenues missed the Zacks Consensus Estimate of $1,045 million.
Gold sales slumped around 16.3% year over year to 768,000 ounces in the reported quarter and production tumbled 16.3% to 761,000 ounces.
All-in sustaining costs (AISC) was $747 per gold ounce (down 23.5% year over year). The decline was mainly due to lower production costs and the favorable impact of the strengthening U.S. dollar against the Argentine and Mexican pesos, partly offset by reduced sales volumes at Cerro Negro, Los Filos and Eleonore. Cash cost totaled $481 per ounce on a by-product basis (down 30% year over year).
Mining Highlights
At the Penasquito mine, gold production was 183,000 ounces, marking an increase when compared to the fourth-quarter 2015 figure as the mine sequenced into the higher grade. AISC was $487 per ounce compared with $687 in the year-ago quarter.
Cerro Negro in Argentina produced 66,000 ounces of gold in the fourth quarter, at an AISC of $1024 per ounce. Production of gold decreased when compared with the fourth-quarter 2015 figure. The lowered production was attributed to the processing of 47,000 tons of gold from the stockpile in 2015 and workforce reduction, related to the restructuring process that commenced in second-quarter 2016. AISC for the fourth-quarter 2016 was higher than the year-ago figure due to reduced production, partly offset by lower production costs.
At Pueblo Viejo, where Goldcorp holds 40% interest, gold production increased to 127,000 ounces (40% basis), at an AISC of $311 per ounce. The increase in production was primarily due to higher throughput when compared with the year-ago quarter. AISC for the fourth-quarter 2016 was lower than the year-ago figure due to higher gold production and lesser production costs owing to the receipt of insurance proceeds related to the oxygen plant failure.
Financial Position
As of Dec 31, 2016, cash and cash equivalents were $157 million, down from $326 million as of Dec 31, 2015. Long-term debt was $2,510 million as of Dec 31, 2016, compared with $2,476 million as of Dec 31, 2015. The company’s adjusted operating cash flow fell to $383 million as of Dec 31, 2016, from $504 million as of Dec 31, 2015.
Outlook
For 2017, Goldcorp expects gold production to be 2.5 million ounces (+/- 5%) at an AISC of around $850 per ounce.
The company continues to realize savings from its $250 million target in annual sustainable efficiencies. Its five-year growth outlook is focused on increasing gold production by 20% to 3 million ounces, reducing AISC by 20% to $700 per ounce and increasing gold reserves by 20% to 50 million ounces.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed an upward trend in fresh estimates. There has been one revision higher for the current quarter. In the past month, the consensus estimate has shifted by 10.04% due to these changes.
VGM Scores
At this time, Goldcorp's stock has a nice Growth Score of 'B', however its Momentum is lagging behind with an 'D'. The stock was allocated a grade of 'D' on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'B'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is solely suitable for growth investors.
Outlook
Estimates have been trending upward for the stock. The magnitude of these revisions also looks promising. Interestingly, the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.
Image: Bigstock
Goldcorp (GG) Down 13.2% Since Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Goldcorp Inc. . Shares have lost about 13.2% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Goldcorp’s Q4 Earnings Beat, Revenues Miss Estimates
Goldcorp reported net earnings of $101 million or $0.12 per share for fourth-quarter 2016 compared with a net loss of $4.3 billion or $5.14 per share a year ago. Earnings per share beat the Zacks Consensus Estimate of $0.09.
Goldcorp posted revenues of $898 million in the reported quarter, down 16.2% year over year. Revenues missed the Zacks Consensus Estimate of $1,045 million.
Gold sales slumped around 16.3% year over year to 768,000 ounces in the reported quarter and production tumbled 16.3% to 761,000 ounces.
All-in sustaining costs (AISC) was $747 per gold ounce (down 23.5% year over year). The decline was mainly due to lower production costs and the favorable impact of the strengthening U.S. dollar against the Argentine and Mexican pesos, partly offset by reduced sales volumes at Cerro Negro, Los Filos and Eleonore. Cash cost totaled $481 per ounce on a by-product basis (down 30% year over year).
Mining Highlights
At the Penasquito mine, gold production was 183,000 ounces, marking an increase when compared to the fourth-quarter 2015 figure as the mine sequenced into the higher grade. AISC was $487 per ounce compared with $687 in the year-ago quarter.
Cerro Negro in Argentina produced 66,000 ounces of gold in the fourth quarter, at an AISC of $1024 per ounce. Production of gold decreased when compared with the fourth-quarter 2015 figure. The lowered production was attributed to the processing of 47,000 tons of gold from the stockpile in 2015 and workforce reduction, related to the restructuring process that commenced in second-quarter 2016. AISC for the fourth-quarter 2016 was higher than the year-ago figure due to reduced production, partly offset by lower production costs.
At Pueblo Viejo, where Goldcorp holds 40% interest, gold production increased to 127,000 ounces (40% basis), at an AISC of $311 per ounce. The increase in production was primarily due to higher throughput when compared with the year-ago quarter. AISC for the fourth-quarter 2016 was lower than the year-ago figure due to higher gold production and lesser production costs owing to the receipt of insurance proceeds related to the oxygen plant failure.
Financial Position
As of Dec 31, 2016, cash and cash equivalents were $157 million, down from $326 million as of Dec 31, 2015. Long-term debt was $2,510 million as of Dec 31, 2016, compared with $2,476 million as of Dec 31, 2015. The company’s adjusted operating cash flow fell to $383 million as of Dec 31, 2016, from $504 million as of Dec 31, 2015.
Outlook
For 2017, Goldcorp expects gold production to be 2.5 million ounces (+/- 5%) at an AISC of around $850 per ounce.
The company continues to realize savings from its $250 million target in annual sustainable efficiencies. Its five-year growth outlook is focused on increasing gold production by 20% to 3 million ounces, reducing AISC by 20% to $700 per ounce and increasing gold reserves by 20% to 50 million ounces.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed an upward trend in fresh estimates. There has been one revision higher for the current quarter. In the past month, the consensus estimate has shifted by 10.04% due to these changes.
Goldcorp Inc. Price and Consensus
Goldcorp Inc. Price and Consensus | Goldcorp Inc. Quote
VGM Scores
At this time, Goldcorp's stock has a nice Growth Score of 'B', however its Momentum is lagging behind with an 'D'. The stock was allocated a grade of 'D' on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'B'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is solely suitable for growth investors.
Outlook
Estimates have been trending upward for the stock. The magnitude of these revisions also looks promising. Interestingly, the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.