Gold Fields (GFI) Stock Up on Higher Gold Prices

NEW YORK (TheStreet) -- Gold Fields (GFI) stock is increasing by 2.54% to $3.64 on heavy trading volume on Friday afternoon, as gold prices continue to climb today.

Gold for December delivery is gaining by 0.49% to $1,158.80 per ounce on the COMEX this afternoon.

Gold prices continued to rise today due to weak Chinese factory data, which drove financial markets down, Reuters reports.

The precious metal had rebounded this week after the release of the minutes from the latest Fed meeting lowered expectations for a U.S. interest rate hike in September.

"The massive move we have experienced during the past couple of days... was primarily on the back of dollar softness and qualms around emerging markets," Ava Trade chief market analyst Naeem Aslam told Reuters.

South Africa-based Gold Fields operates eight mines in Ghana, South Africa, Peru and Australia.

So far today, 6.46 million shares of Gold Fields have exchanged hands compared with its average daily volume of 4.38 million shares.

Separately, TheStreet Ratings team rates GOLD FIELDS LTD as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

"We rate GOLD FIELDS LTD (GFI) 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 unimpressive growth in net income, poor profit margins and weak operating cash flow."

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 4533.3% when compared to the same quarter one year ago, falling from -$0.30 million to -$13.90 million.
  • The gross profit margin for GOLD FIELDS LTD is currently lower than what is desirable, coming in at 33.77%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -2.27% is significantly below that of the industry average.
  • Net operating cash flow has decreased to $150.20 million or 24.10% when compared to the same quarter last year. Despite a decrease in cash flow GOLD FIELDS LTD is still fairing well by exceeding its industry average cash flow growth rate of -43.14%.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Metals & Mining industry and the overall market on the basis of return on equity, GOLD FIELDS LTD underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • Despite currently having a low debt-to-equity ratio of 0.56, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further.
  • You can view the full analysis from the report here: GFI Ratings Report

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