AGNICO EAGLE MINES mit 50% Potenzial

Taylor Dart, 17. Feb.

Auszug

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Looking at the chart above , Agnico has historically traded at 12.5x cash flow, and I would argue that a multiple of 13.0 is more than reasonable, given that it's the premier major producer with favorable jurisdictions and attractive margins. Based on conservative FY2023 cash flow estimates of $4.50, this translates to a fair value for the stock of US$58.50, pointing to 20% upside from current levels. However, this fair value estimate is based on what will be a weak year for Agnico, and it doesn't place any value on its strong development pipeline or exploration upside, where I think we can easily assign a value of $5.0+ billion (Santa Gertrudis, Upper Beaver, Wasamac, Hammond Reef, Hope Bay, San Nicolas [50%], exploration upside). It also doesn't place any value on organic growth at existing assets like Detour Lake."


"Given that valuing the stock on cash flow understates the company's long-term potential, I believe the best way to value Agnico Eagle Mines Limited stock is on a P/NAV basis. Based on an estimated net asset value of ~$23.7 billion after adjusting for G&A expenses, and assigning a 1.45x P/NAV multiple given its strong history of reserve replacement, I see a fair value for Agnico stock of ~$35.0 billion. After dividing by ~490 million shares (year-end 2023), this translates to a fair value for the stock of US$71.40, translating to a 44% upside from current levels or ~47% upside on a total return basis.

Importantly, this doesn't account for upside in the gold price, with these assumptions based on a $1,700/oz gold price, in line with the three-year average. Given its undervaluation, I continue to see Agnico as one of the best buy-the-dip candidates sector-wide."


Chart Cashflow