Hecla Mining (HL) Stock Down as Gold Prices Slip

Hecla Mining (HL) stock is slumping amid today's decline in gold prices.
By Amanda Schiavo ,

NEW YORK (TheStreet) -- Shares of Hecla Mining (HL) - Get Report are falling by 4.96% to $1.87 on Tuesday morning, as some mining and metals stocks retreat today due to the decline in the price of gold.

The precious metal is shaking off gains it saw following the terrorist attacks in Paris on Friday. The price of gold increased after the events in France on safe haven demand.

With lingering worries about the attacks starting to subside the yellow metal's price has begun trading in the red again, MarketWatch reports.

Gold for December delivery is lower by 0.95% to $1,073.30 per ounce on the COMEX this morning.

"Gold remains stuck at low levels showing along with oil trading that while devastating and tragic, last Friday's terrorist attacks in Paris have not sparked a flight to safety, confirming the resilience of nations who do not back down in the face of terrorism," Colin Cieszynski, chief market strategist at CMC Markets, said in a note, MarketWatch added.

Separately, TheStreet Ratings team rates HECLA MINING CO as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

We rate HECLA MINING CO (HL) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Metals & Mining industry. The net income has significantly decreased by 369.0% when compared to the same quarter one year ago, falling from $3.68 million to -$9.89 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Metals & Mining industry and the overall market on the basis of return on equity, HECLA MINING CO underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • The gross profit margin for HECLA MINING CO is rather low; currently it is at 24.07%. It has decreased significantly from the same period last year.
  • The share price of HECLA MINING CO has not done very well: it is down 21.10% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • HECLA MINING CO has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, HECLA MINING CO turned its bottom line around by earning $0.05 versus -$0.08 in the prior year. For the next year, the market is expecting a contraction of 340.0% in earnings (-$0.12 versus $0.05).
  • You can view the full analysis from the report here: HL

Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.

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