We expect Stillwater Mining (SWC), Barrick Gold (ABX) and Silver Wheaton (SLW) to outperform their peers during this earnings season on the back of commodity outlook, anticipated better performance than consensus estimates, competitive advantage and price-to-earnings multiples.
The company is expected to report earnings of $2.46 per share for 2010 and $2.82 per share for 2011, a significant turnaround from a loss of $4.84 per share reported for 2009. The stock is currently trading at an attractive price-to-earnings ratio of 14.3, the lowest amongst the gold majors. In comparison, gold giants Goldcorp ( GG), Newmont Mining ( NEM), Kinross Gold ( KGC), and Agnico-Eagle Mines ( AEM) are trading at PE multiples of 33.1, 15.1, 27.2, and 30.8, respectively. As per TheStreet's Analyst ratings guide, the stock has 16 buy, seven hold, and one sell ratings.