We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
AEM expects 2025 AISC of $1,250-$1,300 per ounce, up from 2024 as cost pressures persist.
Shares have surged 115.9% YTD, with EPS estimates for 2025 and 2026 trending higher.
Agnico Eagle Mines Limited (AEM - Free Report) delivered better-than-expected earnings in the third quarter, but it remains hamstrung by higher unit costs. Its all-in sustaining cost (AISC) — the most important cost metric of miners — was $1,373 per ounce in the third quarter, marking a roughly 6% increase from the prior quarter and a 7% year-over-year rise. AISC increased due to higher total cash costs and an uptick in general and administrative expenses. Total cash costs per ounce for gold were $994, up 8% from $921 a year ago and higher than $933 in the prior quarter.
Higher production costs warrant caution, as they will likely weigh on AEM’s profitability. This calls for prudent cost management to maintain competitiveness and sustain margins. AEM forecasts total cash costs per ounce in the range of $915 to $965 and AISC per ounce between $1,250 and $1,300 for 2025, suggesting a year-over-year increase at the midpoint of the respective ranges.
While Agnico Eagle is taking actions to control costs, the inflationary pressure is likely to continue over the near term, weighing on its overall financial performance. AISC is likely to rise in the latter part of 2025 as deferred expenditures are realized. Maintaining its cost discipline will be crucial for the company to sustain its margin expansion.
Among AEM’s peers, Newmont Corporation (NEM - Free Report) lowered its third-quarter AISC to $1,566 per ounce, marking a 3% decrease from the prior-year quarter and a decline from $1,593 in the prior quarter. This improvement was primarily due to a decline in costs applicable to sales and lower general and administrative expenses, as Newmont is enjoying the benefits from its cost-saving actions. Newmont expects gold AISC for the total portfolio to be $1,630 per ounce in 2025, reflecting a rise from $1,516 per ounce in 2024.
Barrick Mining Corporation (B - Free Report) also saw a 9% sequential decline in AISC in the third quarter, reaching $1,538 per ounce. This downside was driven by lower total cash costs per ounce and lower minesite sustaining capital expenditures. Barrick maintained its cost guidance for the full year. For 2025, Barrick projects AISC in the range of $1,460-$1,560 per ounce, indicating a year-over-year increase at the midpoint.
The Zacks Rundown for AEM
Shares of Agnico Eagle have shot up 115.9% year to date against the Zacks Mining – Gold industry’s rise of 130.1%, largely driven by the gold price rally.
Image Source: Zacks Investment Research
From a valuation standpoint, AEM is currently trading at a forward 12-month earnings multiple of 19.51, a roughly 46.1% premium to the industry average of 13.35X. It carries a Value Score of C.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for AEM’s 2025 and 2026 earnings implies a year-over-year rise of 82.3% and 20.7%, respectively. The EPS estimates for 2025 and 2026 have been trending higher over the past 60 days.
Image Source: Zacks Investment Research
AEM stock currently carries a Zacks Rank #3 (Hold).
Image: Bigstock
Can Agnico Eagle Keep Its Shine Amid Rising Production Costs?
Key Takeaways
Agnico Eagle Mines Limited (AEM - Free Report) delivered better-than-expected earnings in the third quarter, but it remains hamstrung by higher unit costs. Its all-in sustaining cost (AISC) — the most important cost metric of miners — was $1,373 per ounce in the third quarter, marking a roughly 6% increase from the prior quarter and a 7% year-over-year rise. AISC increased due to higher total cash costs and an uptick in general and administrative expenses. Total cash costs per ounce for gold were $994, up 8% from $921 a year ago and higher than $933 in the prior quarter.
Higher production costs warrant caution, as they will likely weigh on AEM’s profitability. This calls for prudent cost management to maintain competitiveness and sustain margins. AEM forecasts total cash costs per ounce in the range of $915 to $965 and AISC per ounce between $1,250 and $1,300 for 2025, suggesting a year-over-year increase at the midpoint of the respective ranges.
While Agnico Eagle is taking actions to control costs, the inflationary pressure is likely to continue over the near term, weighing on its overall financial performance. AISC is likely to rise in the latter part of 2025 as deferred expenditures are realized. Maintaining its cost discipline will be crucial for the company to sustain its margin expansion.
Among AEM’s peers, Newmont Corporation (NEM - Free Report) lowered its third-quarter AISC to $1,566 per ounce, marking a 3% decrease from the prior-year quarter and a decline from $1,593 in the prior quarter. This improvement was primarily due to a decline in costs applicable to sales and lower general and administrative expenses, as Newmont is enjoying the benefits from its cost-saving actions. Newmont expects gold AISC for the total portfolio to be $1,630 per ounce in 2025, reflecting a rise from $1,516 per ounce in 2024.
Barrick Mining Corporation (B - Free Report) also saw a 9% sequential decline in AISC in the third quarter, reaching $1,538 per ounce. This downside was driven by lower total cash costs per ounce and lower minesite sustaining capital expenditures. Barrick maintained its cost guidance for the full year. For 2025, Barrick projects AISC in the range of $1,460-$1,560 per ounce, indicating a year-over-year increase at the midpoint.
The Zacks Rundown for AEM
Shares of Agnico Eagle have shot up 115.9% year to date against the Zacks Mining – Gold industry’s rise of 130.1%, largely driven by the gold price rally.
From a valuation standpoint, AEM is currently trading at a forward 12-month earnings multiple of 19.51, a roughly 46.1% premium to the industry average of 13.35X. It carries a Value Score of C.
The Zacks Consensus Estimate for AEM’s 2025 and 2026 earnings implies a year-over-year rise of 82.3% and 20.7%, respectively. The EPS estimates for 2025 and 2026 have been trending higher over the past 60 days.
AEM stock currently carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.