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McEwen Mining (MUX) Moves 7.3% Higher: Will This Strength Last?

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McEwen (MUX - Free Report) shares ended the last trading session 7.3% higher at $8.98. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 35.9% gain over the past four weeks.

McEwen Mining’s stock has seen an uptick in response to gold prices, which have recently hit record highs. The Federal Reserve has announced its decision to maintain the federal funds rate within the range of 5.25% to 5.5%. This has fueled expectations of potential interest rate cuts later in the year, causing a spike in the value of the precious metal.

McEwen Mining has been gaining since it reported solid Q4 and 2023 results on Feb 29. Revenues from the sales of gold and silver surged impressively by 51% year over year, reaching $166.2 million. The company reported a net income of $54.7 million (or $1.15 per share) for the year, which marked a turnaround performance from the previous year's net loss of $81.1 million (or $1.71 per share). This improvement was largely attributed to the company's strategic focus on its McEwen Copper division and the Los Azules copper project.

McEwen Mining reported a 25% year-over-year increase in gold production, totaling 128,650 ounces, while silver production experienced a 17% decline, amounting to approximately 2.17 million ounces. Gold equivalent ounces produced during the year was 154,600, up 16% year over year, which came in line with the company’s guidance.

This gold and silver mining company is expected to post quarterly loss of $0.03 per share in its upcoming report, which represents a year-over-year change of +78.6%. Revenues are expected to be $39.8 million, up 14.5% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For McEwen Mining, the consensus EPS estimate for the quarter has been revised 83.3% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on MUX going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

McEwen Mining belongs to the Zacks Mining - Miscellaneous industry. Another stock from the same industry, MP Materials Corp. (MP - Free Report) , closed the last trading session 5.7% higher at $13.82. Over the past month, MP has returned -19.3%.

MP Materials' consensus EPS estimate for the upcoming report has changed +70% over the past month to $0. Compared to the company's year-ago EPS, this represents a change of -100%. MP Materials currently boasts a Zacks Rank of #4 (Sell).


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