NEW YORK (TheStreet) -- Shares of Yamana Gold were gaining 5.1% to $4.03 Wednesday as gold prices increased. U.S. gold futures for June delivery were up 0.9% to $1,203.30 an ounce on the Comex Wednesday afternoon. Gold prices were rising Wednesday due to concerns over financial problems in Greece, according to the Wall Street Journal. A senior European Union official said that Greece's negotiations with international creditors aren't at a point where the country can receive bailout money, while the country's government warned it would run out of money without the bailout money, according to the Journal. The comments from the two sides could potentially lead to Greece defaulting on its debt or exiting from the euro. Many investors buy gold during political and economic uncertainty on the belief that it will perform better than other assets, which helps drive up the price of the precious metal. Yamana Gold is a gold mining company with properties and positions in Brazil, Chile, Argentina, Mexico, and Colombia. TheStreet Ratings team rates YAMANA GOLD INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation: "We rate YAMANA GOLD INC (AUY) a SELL. This is driven by some concerns, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, weak operating cash flow and generally disappointing historical performance in the stock itself." Highlights from the analysis by TheStreet Ratings Team goes as follows: The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Metals & Mining industry. The net income has significantly decreased by 132.7% when compared to the same quarter one year ago, falling from -$583.89 million to -$1,358.57 million. Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Metals & Mining industry and the overall market, YAMANA GOLD INC's return on equity significantly trails that of both the industry average and the S&P 500. The gross profit margin for YAMANA GOLD INC is currently extremely low, coming in at 2.08%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, AUY's net profit margin of -250.22% significantly underperformed when compared to the industry average. Net operating cash flow has declined marginally to $183.13 million or 0.92% when compared to the same quarter last year. Despite a decrease in cash flow of 0.92%, YAMANA GOLD INC is still significantly exceeding the industry average of -51.60%. AUY's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 56.63%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now. You can view the full analysis from the report here: AUY Ratings Report Must Read: Warren Buffett's Top 25 Stocks for 2015
Click to view a price quote on AUY. Click to research the Metals & Mining industry.
from Latest TSC Headlines http://ift.tt/1COFK3Z
No comments:
Post a Comment