Hecla Mining (HL) Stock Falls as Gold, Silver Prices Decline

NEW YORK (TheStreet) -- Shares of silver miner Hecla Mining  (HL) fell 5.42% to $2.70 in afternoon trading Monday as silver prices slumped.

Silver prices were down 2.3% to $15.77 an ounce at 2:24 p.m., according to CNBC. Gold futures also dropped 1.17% to $1,181.30.

A strong dollar has kept gold prices down for the last several weeks, and silver prices have suffered similarly. Gold hits its 2014 high of $1,392.60 on March 17 but has traded below $1,200 an ounce for much of the past several weeks.

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"The overall environment is very negative for gold," Phil Streible, a senior commodity broker at R.J. O'Brien & Associates in Chicago, told Bloomberg last week. "The market will remain volatile as trading will be very thin for the next two weeks."

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 some concerns, 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. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself."

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

  • In its most recent trading session, HL has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. 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.
  • 35.81% is the gross profit margin for HECLA MINING CO which we consider to be strong. Regardless of HL's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, HL's net profit margin of 2.71% is significantly lower than the industry average.
  • 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 has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • HECLA MINING CO reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, HECLA MINING CO swung to a loss, reporting -$0.08 versus $0.05 in the prior year. This year, the market expects an improvement in earnings (-$0.02 versus -$0.08).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Metals & Mining industry. The net income increased by 143.5% when compared to the same quarter one year prior, rising from -$8.46 million to $3.68 million.
  • You can view the full analysis from the report here: HL Ratings Report

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