The mining industry seems to have found its footing this year after a difficult 2015 that bore the brunt of a crash in the commodity prices. Particularly, silver and gold have been major movers this year, gaining 31% and 19% respectively so far owing to the slowdown in China, volatile equity markets due to Brexit, a dovish Fed and introduction of negative interest rates by several central banks (including Japan).
As per the Zacks Industry classification, the mining industry is grouped under the Basic Material sector – one of the 16 broad Zacks sectors. As of Nov 4, 85% of the companies in this sector that have reported so far have put up a 6.4% increase in earnings. Combining with the projected figures of the companies that are yet to report, the sector will log a growth of 4.2% in the quarter.
The 84.6% of the companies in the S&P 500 that have reported registered an earnings growth of 3.6%. Taking into consideration the estimates from the still-to-come 77 index members, total earnings in the quarter is now anticipated to go up 3% year over year on the back of 1.5% higher revenues. This compares favorably with the decline of 2.8% in the second quarter on flat revenues. Though the growth rate is meager, but compared to the declines for five consecutive quarters, this is definitely a positive sign. (Read more: Q3 Earnings Season: An Inflection Point).
Let’s see what’s in store for these miners that are set to report third-quarter numbers on Nov 10.
Alamos Gold, Inc. (AGI - Free Report) explores for mines, develops and produces gold deposits in the U.S. and Canada. Further, the company explores for silver and precious metals. The company will report results before the market opens.
The company had delivered a negative earnings surprise of 200% in the second quarter. Alamos Gold has an overall negative track record with an average negative earnings surprise of 103.22% over the trailing four quarters.
ALAMOS GOLD INC Price and EPS Surprise
An earnings beat is unlikely this quarter for Alamos Gold given its Earnings ESP of 0.00% and a Zacks Rank #4 (Sell). As it is, the Zacks #4 or 5 (Sell-rated stocks) should never be considered going into an earnings announcement. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Seabridge Gold, Inc. (SA - Free Report) engages in the acquisition and exploration of gold properties located in North America. Additionally, it explores for copper and silver ores.
SEABRIDGE GOLD Price and EPS Surprise
The Zacks Consensus Estimate for the third quarter is at 2 cents, a 60% plunge year over year. The company recently reported third-quarter preliminary results wherein the company reported company-wide production of 18,856 ounces of gold for the quarter, which positions it to achieve its production guidance for the year.
An earnings beat is unlikely this quarter for Richmond Mines given its Earnings ESP of 0.00% and a Zacks Rank #4. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
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