Agnico Eagle Mines Limited (NYSE:AEM) has been experiencing accelerated earnings and sales growth over the past five years.  Over that time frame the firm has seen earnings growth of 18.80% and sales growth of 6.00%.

Investors may be trying to gauge the current business cycle phase and how that could potentially impact the portfolio. Business cycles can be one way to analyze portfolio performance. Early on in the cycle, profits tend to grow rapidly, sales tend to improve, and activity rebounds. In the middle of a cycle, growth may be peaking, strong credit growth may still be seen, and policy may swing neutral. Toward the later stages, growth may be moderate, earnings may come under pressure, and credit may tighten. Heading into a period of recession, credit may completely dry up, profits may decline sharply, and there may be policy easing. Investors will often have to adjust portfolio holdings that reflect the current state of a business cycle.

While the firm has enjoyed the upward movement, it’s important to look at analyst expectations and where the company is headed from here.  On a consensus basis, analysts are projecting EPS growth of 91.81% for next year and have a $69.17 one year price target on the stock.   The stock recently traded at $60.00.

RECENT PERFORMANCE

Let’s take a look at how the stock has been performing recently.  Over the past twelve months, Agnico Eagle Mines Limited (NYSE:AEM)‘s stock was 48.51%.  Over the last week of the month, it was 2.35%, -3.47% over the last quarter, and  45.88% for the past six months. 

Earnings Per Share (EPS):

EPS is what each share is worth and indicates how much money their sharehoders would acquire if the company was to pay out all of its profits.  Earnings Per Share is computed by dividing the profit total by its share total.  If a company’s profit is $800 million and there are 40 million shares, then the EPS is $20.  EPS is a fantastic way to compare and contrast companies in the same industry.  When a company shows a steady upwards earnings trend, it is a good indicator that the company will dominate companies with a more volatile earnings trend. Agnico Eagle Mines Limited (NYSE:AEM)’s EPS is -1.09.  Last year, their EPS growth was -235.20% while their EPS growth over the past five years is 18.80%.  Analysts are predicting Agnico Eagle Mines Limited’s stock to grow 91.81% over the next year and 61.84% over the next five.

Stock market investing can indeed tug on an individual’s emotional strings. When the market becomes tumultuous, investors may be tempted to act impulsively, or they may freeze and not act at all. Being prepared for various scenarios may help the investor better deal with the market when the time comes. Staying disciplined with portfolio rebalancing and asset allocation may be a big help for the individual investor. Investors who constantly try to outguess the market and chase winners may eventually find themselves swimming upstream. Staying the course and keeping a logical perspective may assist the investor with making the tricky portfolio decisions when necessary.  

Nothing contained in this publication is intended to constitute legal, tax, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. The general information contained in this publication should not be acted upon without obtaining specific legal, tax, and investment advice from a licensed professional.