NEW YORK (TheStreet) -- Shares of Hecla Mining (HL - Get Report) are rising by 6.28% to $2.20 in afternoon trading on Tuesday, as the company bounces back from Monday's decline, which was the result of gold prices falling a record-low.
Gold for August delivery is down 0.43% to $1,102 per ounce on the COMEX this afternoon.
Spot gold fell to a five-year-low of $1,088.05 per ounce on Monday, slipping below the $1,100 support level, Reuters reports.
A possible hike in U.S. interest rates and slow demand in Asia drove gold prices down yesterday.
The Chinese government also disclosed it had less gold reserves than estimated, according to Reuters.
Gold prices may fall to as low as $1,050 per ounce by the end of the year, OCBC Bank analysts Barnabas Gan told Reuters.
Hecla Mining is a metals company focused on producing silver, gold, lead and zinc.
Separately, TheStreet Ratings team rates HECLA MINING CO as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:
"We rate HECLA MINING CO (HL) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its increase in net income, largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- 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 7.8% when compared to the same quarter one year prior, going from $11.64 million to $12.55 million.
- The current debt-to-equity ratio, 0.37, is low and is below the industry average, implying that there has been successful management of debt levels. Along with this, the company maintains a quick ratio of 2.70, which clearly demonstrates the ability to cover short-term cash needs.
- Despite the weak revenue results, HL has outperformed against the industry average of 17.8%. Since the same quarter one year prior, revenues slightly dropped by 5.3%. Weakness in the company's revenue seems to not be hurting the bottom line, shown by stable earnings per share.
- Net operating cash flow has decreased to $21.42 million or 29.50% when compared to the same quarter last year. Despite a decrease in cash flow HECLA MINING CO is still fairing well by exceeding its industry average cash flow growth rate of -54.90%.
- HL's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 26.92%, which is also worse than the performance of the S&P 500 Index. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
- You can view the full analysis from the report here: HL Ratings Report