NEW YORK (TheStreet) -- Shares of Hecla Mining (HL) - Get Report are higher by 7.14% to $2.55 in midday trading on Wednesday, as the rally in the price of gold drives some mining and related stocks into the green today.
Gold for December delivery is up by 1.12% to $1,178.40 per ounce on the COMEX this afternoon.
The price of the precious metal hit a three month high on signs that calm global inflation has weakened the Federal Reserve's case for raising interest rates, Bloomberg reports.
Hecla Mining is a Coeur d'Alene ID-based company that operates by discovering, acquiring, developing and producing silver, gold, lead and zinc.
Higher interest rates can weigh on gold as the asset pays no interest to those that hold it. The metal can struggle against interest-bearing assets when rates rise.
"It would seem that the Fed cannot agree on when rates should rise and this uncertainty is leading to short covering and fresh buying in the yellow metal," Marex Spectron head of precious metals David Govett told the Journal.
Gold, having gained over 5% this month, is close to its largest rise since January due to signals of weakening global economies, Bloomberg 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 several 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 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 share price of HECLA MINING CO has not done very well: it is down 9.06% 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. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.
- 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 300.0% in earnings (-$0.10 versus $0.05).
- The change in net income from the same quarter one year ago has significantly exceeded that of the Metals & Mining industry average, but is less than that of the S&P 500. The net income has significantly decreased by 85.2% when compared to the same quarter one year ago, falling from -$14.40 million to -$26.67 million.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength 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.
- Despite the weak revenue results, HL has significantly outperformed against the industry average of 46.8%. Since the same quarter one year prior, revenues fell by 11.3%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- You can view the full analysis from the report here: HL