For the first quarter Gold Resource reported earnings of 13 cents a share, beating the Capital IQ Consensus Estimate of 5 cents a share by 8 cents. Revenue fell -26.4% from the year-ago quarter to $31.15 million. Analysts expected revenue of $28.8 million for the quarter.
"During the first quarter, the Company delivered strong operating results with production increasing 15% over the prior quarter," Gold Resource CEO and President Mr. Jason Reid said in a press release. "Equally important, we substantially drove down our total cash costs by 38% compared to the fourth quarter of 2013. In addition, we continued to distribute our monthly dividend and increased our treasury by $4.5 million over the prior quarter. With a strong first quarter, the Company is on track to meet its annual production outlook goal."
TheStreet Ratings team rates GOLD RESOURCE CORP as a Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:
"We rate GOLD RESOURCE CORP (GORO) 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 deteriorating net income, disappointing return on equity, weak operating cash flow, 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 144.7% when compared to the same quarter one year ago, falling from $9.17 million to -$4.10 million.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Metals & Mining industry and the overall market on the basis of return on equity, GOLD RESOURCE CORP underperformed against that of the industry average and is significantly less than that of the S&P 500.
- Net operating cash flow has significantly decreased to $3.21 million or 73.34% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 64.06%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 147.05% compared to the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
- GOLD RESOURCE CORP 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. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, GOLD RESOURCE CORP swung to a loss, reporting -$0.01 versus $0.60 in the prior year. This year, the market expects an improvement in earnings ($0.35 versus -$0.01).
- You can view the full analysis from the report here: GORO Ratings Report
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.