Is it a good company at a reasonable price? Personally, I have little in the way of resource stocks. Generally, I think that they are too volatile for a long term buy. However, a lot of analysts disagree with me on that point. This stock has generally done well for its shareholders. Looking this stock’s chart over the long term, it is relatively high. When I have bought resource stocks in the past, for short-term investments, I have always bought them when their charts show that the stock price is relatively low. On the other hand, my testing is showing the stock price is reasonable and perhaps cheap.
I do not own this stock of Agnico Eagle Mines Ltd (TSX-AEM, NYSE-AEM). Recently, two mining stocks were recommended. Agnico-Eagle Mines Ltd (TSX-AEM) was recommended by Advice for Investors site. Franco-Nevada (FNV.T) was recommended by a member of Ellen’s Investment Club. I decided to look at Agnico-Eagle Mines because it was on the Money Sense List of Dividend Stocks.
When I was updating my spreadsheet, I noticed this company has generally had good growth over the past 5 and 10 years. Growth is been lower this year to the end of the third quarter. Analysts are still expecting the company to cut dividends this year, but all 2024 dividends have been paid and there was no cut. In the chart below, I am showing 5 and 10 year total growth and per year growth in columns 3 and 4. Column 5 shows growth expected over 12 months to the third quarter in 2024 and expected growth over this year.
| Yr | Item | Tot. Gwth | Per Year | Gwth | Coverage |
|---|---|---|---|---|---|
| 5 | Revenue Growth | 202.43% | 24.77% | 17.98% | <-12 mths |
| 5 | AEPS Growth | 619.35% | 48.38% | 58.74% | <-12 mths |
| 5 | Net Income Growth | 694.22% | 51.35% | -48.21% | <-12 mths |
| 5 | Cash Flow Growth | 329.55% | 33.85% | 36.72% | <-12 mths |
| 5 | Dividend Growth | 263.64% | 29.46% | 0.00% | <-12 mths |
| 5 | Stock Price Growth | 36.17% | 6.37% | 52.63% | <-12 mths |
| 10 | Revenue Growth | 304.47% | 15.00% | 26.39% | <-this year |
| 10 | AEPS Growth | 150.56% | 9.62% | 86.55% | <-this year |
| 10 | Net Income Growth | 577.54% | 21.09% | 4.21% | <-this year |
| 10 | Cash Flow Growth | 493.56% | 19.49% | 46.41% | <-this year |
| 10 | Dividend Growth | 81.82% | 6.16% | -10.19% | <-this year |
| 10 | Stock Price Growth | 111.53% | 7.78% | 82.95% | <-this year |
The current dividend yield is low with dividend growth good until this year. The dividend yield is low (below 2%) at 1.91%. The 5 year median yield is moderate (2% to 4% ranges) at 2.26%. The 10 year median and historical median dividend yields are low at 1.11% and 1.00%. Dividend increases over the past 5 year were good (15% and above) at 29.46% per year. However, there was no dividend increase in 2024. There has been no decrease in dividends, but analysts seem to expect the dividend to decrease over the short term, at least.
The Dividend Payout Ratios (DPR) could improve for AEPS, but the ratios for CFPS are fine. The DPR for 2023 for Earnings per Share (EPS) is good at 41% with 5 year coverage a little high at 52%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is high at 72% with 5 year coverage at 62%. The DPR for 2023 for Cash Flow per Share (CFPS) is good at 29% with 5 year coverage at 23%. The DPR for 2023 for Free Cash Flow (FCF) is high at 74% with 5 year coverage at 80%. However, there is no agreement on what the FCF is.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 40.51% | 51.74% |
| AEPS | 71.75% | 61.68% |
| CFPS | 28.96% | 23.89% |
| FCF | 73.67% | 80.29% |
Debt Ratios are good. The Long Term Debt/Market Cap Ratio for 2023 is good at 0.25 and currently at 0.15. The Liquidity Ratio for 2023 is good at 2.09 and 1.75 currently. The Debt Ratio for 2023 is good at 3.10 and 3.20 currently. The Leverage and Debt/Equity Ratios for 2023 are good at 1.48 and 0.48 and currently at 1.45 and 0.45.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 0.25 | 0.15 |
| Intang/GW | 0.15 | 0.10 |
| Liquidity | 2.09 | 1.75 |
| Liq. + CF | 3.81 | 3.55 |
| Debt Ratio | 3.10 | 3.20 |
| Leverage | 1.48 | 1.45 |
| D/E Ratio | 0.48 | 0.45 |
The Total Return per year is shown below for years of 5 to 20 to the end of 2023 in CDN$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2018 | 5 | 28.66% | 8.23% | 5.72% | 2.51% |
| 2013 | 10 | 8.50% | 12.26% | 10.17% | 2.09% |
| 2008 | 15 | 16.27% | 2.40% | 1.15% | 1.25% |
| 2003 | 20 | 22.14% | 9.48% | 7.97% | 1.51% |
The Total Return per year is shown below for years of 5 to 20 to the end of 2023 in US$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2018 | 5 | 29.46% | 8.96% | 6.37% | 2.59% |
| 2013 | 10 | 6.16% | 9.70% | 7.78% | 1.92% |
| 2008 | 15 | 15.68% | 1.89% | 0.59% | 1.30% |
| 2003 | 20 | 22.00% | 9.51% | 7.85% | 1.67% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 20.02, 27.95 and 34.35. The corresponding 10 year ratios are 22.67, 31.45 and 41.35. The corresponding historical ratios are 23.00, 30.98 and 40.06. The current P/E Ratio is 19.59 based on a stock price of $112.94 and EPS estimate for 2024 of $5.77 ($4.01 US$). This ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap. This testing is in CDN$.
I also have Adjusted Earnings per Share (data). The 5-year low, median, and high median Price/Earnings per Share Ratios are 19.55, 25.74 and 31.70. The corresponding 10 year ratios are 34.73, 44.22 and 53.72. The current P/AEPS Ratio is 18.89 based on a stock price of $78.57 and AEPS estimate for 2024 of $4.16. This ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$ and you will get a similar result in CDN$.
I get a Graham Price of $88.96. The 10-year low, median, and high median Price/Graham Price Ratios are 1.50, 2.11 and 2.53. The current P/GP Rati is 1.27 based on a stock price of $112.94. The current ratio is below the low ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap. This testing is in CDN$.
I get a 10-year median Price/Book Value per Share Ratio of 2.13. The current ratio is 1.92 based on a Book Value of $20,505M, Book Value per Share of $40.89 and a stock price of $78.57. The current ratio is 10% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$ and you will get a similar result in CDN$.
I also have a Book Value per Share estimate for 2024 of $41.62. This implies a ratio of 1.89 and a Book Value of $20,873M with a stock price of $78.57. This ratio is 11% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$ and you will get a similar result in CDN$.
I get a 10-year median Price/Cash Flow per Share Ratio of 12.03. The current P/CF Ratio is 10.34 based on Cash Flow per Share estimate for 2024 of $7.60, Cash Flow of $3,809M and a stock price of $78.57. This ratio is 14% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$ and you will get a similar result in CDN$.
I get an historical median dividend yield of 1.00%. The current dividend yield is 2.04% based on dividends of $1.60 and a stock price of $78.57. The current dividend yield is 103% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$ and you will get a similar result in CDN$.
I get a 10 year median dividend yield of 1.11%. The current dividend yield is 2.04% based on dividends of $1.60 and a stock price of $78.57. The current dividend yield is 83% above the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$ and you will get a similar result in CDN$.
The 10-year median Price/Sales (Revenue) Ratio is 4.24. The current P/S Ratio is 4.70 based on Revenue estimate for 2024 of $8,376M, Revenue per Share of $16.70 and a stock price of $78.57. The current ratio is 11% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$ and you will get a similar result in CDN$.
Results of stock price testing is that the stock price is probably reasonable, but it might be cheap. The dividend yield tests are saying that the stock price is relatively cheap. However, the P/S Ratio test does not confirm this and is showing the stock price as relatively reasonable. The rest of the testing is showing the stock price as relatively cheap or reasonable.
When I look at analysts’ recommendations, I find Strong Buy (9), Buy (7), Hold (1), Sell (1). The consensus is a Strong Buy. The 12 months stock price consensus is $144.15 ($100.35 US$) with a high of $182.22 ($126.85 US$) and low of $83.32 ($58.00 US). The consensus stock price of $144.15 implies a total return of 29.67% with 27.64% from capital gains and 2.04% from dividends.
There are quite a few analysts on Stock Chase following this stock. They do like the company and most say it is a buy, but a couple say that they are worried about where the price of gold might be going. Stock Chase give this stock 5 stars out of 5. Joey Frenette on Motley Fool recommends this stock as a top mining gold stock. Adam Othman on Motley Fool thinks that gold will finish year on a strong note and he recommendations this stock. The company put out a Press Release about their fourth quarter of 2023. The company put out a Press Release about their third quarter of 2024.
Insider Monkey via Yahoo Finance has a review on this stock.
Agnico Eagle is a gold miner with mines in Canada, Mexico, Finland, and Australia. Its web site is here Agnico Eagle Mines Ltd . Simply Wall Street has 3 warnings on this stock of profit margins (12.9%) are lower than last year (40.1%); large one-off items impacting financial results; and significant insider selling over the past 3 months.
The last stock I wrote about was about was be KP Tissue Inc (TSX-KPT, OTC-KPTSF) ... learn more. The next stock I will write about will be Titanium Transportation Group Inc (TSX-TTNM, OTCQX-TTNMF) ... learn more on December 25, 2024 around 5 pm. Tomorrow on my other blog I will write about Capital Compounders Show.... learn more on Tuesday, December 24, 2024 around 5 pm.
This blog is meant for educational purposes only and is not to provide investment advice. I am not a licensed professional investment advisor. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
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