Gold Fields Set to Report Q2 Earnings: Buy, Sell or Hold the Stock?

Core Viewpoint - Gold Fields Limited (GFI) is expected to report its second-quarter and first-half fiscal 2025 results on August 22, with earnings estimates remaining stable at 59 cents per share [1][2]. Group 1: Earnings and Production Performance - GFI's second-quarter production for 2025 is projected at 585,000 ounces, reflecting a 6% year-over-year increase, while total production for the first half of 2025 reached 1,136,000 ounces, a 24% increase compared to the previous year [5][7]. - The company anticipates headline earnings per share for the first half of 2025 to be between $1.09 and $1.21, representing a significant increase of 203-236% from 36 cents per share in the same period last year [8][9]. - Normalized earnings per share are expected to range from $1.06 to $1.18, indicating a 165-195% rise from 40 cents in the first half of 2024 [9]. Group 2: Cost and Pricing Dynamics - The all-in costs for GFI in the second quarter of 2025 are projected at $2,054 per ounce, up from $1,861 per ounce in the prior-year quarter, while the all-in sustaining cost is expected to be $1,739 per ounce, a 7% increase year-over-year [7][8]. - Rising mining costs have contributed to the increase in all-in costs, which may offset some of the gains from higher gold volumes and prices [9]. Group 3: Market Performance and Valuation - GFI shares have increased by 122% year-to-date, outperforming the industry growth of 72%, as well as competitors Franco-Nevada Corporation (FNV) and Agnico Eagle Mines Limited (AEM), which gained 47.5% and 66.5% respectively [10]. - GFI is currently trading at a forward price/sales ratio of 3.11, which is lower than the industry average of 3.40, while FNV and AEM are trading at higher ratios of 19.54 and 6.07 respectively [13]. Group 4: Strategic Developments - Gold Fields is on track to meet its gold production guidance of 2.25-2.45 million ounces, indicating a year-over-year growth of 13.5% [15]. - The company is enhancing its portfolio through strategic acquisitions, including the full ownership of the Windfall project in Quebec and the pending acquisition of Gold Road, which will provide full ownership of the Gruyere mine in Australia [15][16]. - The ramp-up at Salares Norte in Chile is progressing, with commercial production expected in the third quarter of 2025 [15].