Workflow
AEM's Lower AISC Signals Strong Cost Discipline: Can It Be Sustained?
AEMAgnico Eagle(AEM) ZACKS·2025-06-04 12:21

Core Insights - Agnico Eagle Mines Limited (AEM) achieved a significant milestone by reducing its all-in sustaining costs (AISC) to 1,183perounceinQ12025,a101,183 per ounce in Q1 2025, a 10% decrease from the previous quarter, primarily due to deferred capital expenditures at key operations [1][6] - In contrast, Newmont Corporation (NEM) reported an AISC of 1,651 per ounce, reflecting a 13% increase, attributed to a decline in production from non-core asset divestments [2] - Barrick Mining Corporation (B) experienced a 22% increase in AISC to 1,775perounce,influencedbyoperationalchallengesandlowerproductionduetothesuspensionofoperationsatitsLoulo−Gounkotomine[3]CompanyPerformance−AEM′srecord−highoperatingmargininQ12025highlightsitseffectivecostcontrolmeasures[1][6]−AEManticipateshigherAISCinthelatterpartof2025,forecastingAISCbetween1,775 per ounce, influenced by operational challenges and lower production due to the suspension of operations at its Loulo-Gounkoto mine [3] Company Performance - AEM's record-high operating margin in Q1 2025 highlights its effective cost control measures [1][6] - AEM anticipates higher AISC in the latter part of 2025, forecasting AISC between 1,250 and $1,300 per ounce, indicating a year-over-year increase at the midpoint [4][6] - AEM's shares have increased by 56.6% year-to-date, outperforming the Zacks Mining – Gold industry's rise of 55.6% [5] Valuation and Earnings Estimates - AEM is currently trading at a forward 12-month earnings multiple of 20.26, which is a 41.1% premium to the industry average of 14.36 [8] - The Zacks Consensus Estimate for AEM's earnings implies a year-over-year rise of 42.6% for 2025 and 0.8% for 2026, with EPS estimates trending higher over the past 60 days [9]