It wouldn’t be out of line to think a gold miner like El Dorado Gold (NYSE:EGO) would be doing well right now. Mining gold in an uncertain economy sounds like a great hedge. But El Dorado Gold was up over 5.5% in Friday afternoon’s trading not because of its resilience in a bad economy but rather because of its earnings report. It may have been a mixed bag, but it was enough for investors.
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The good news for El Dorado came in with earnings. El Dorado posted $0.11 in earnings per share, and analysts were only expecting it to bring in $0.04 per share. Revenue, however, faltered a bit. Not by much, but enough to qualify as a miss. El Dorado posted revenue of $229.4 million, which was short of the $236.6 million analysts projected. That $229.4 million, however, represented a 17.8% improvement over the previous year’s figures.
While some of this gain can be attributed to fluctuations in the price of gold, there’s too much here to simply say gold led the way. A good portion of those gains were likely production-related. Indeed, production increased 21% year-over-year, and El Dorado’s target range now sits between 475,000 and 515,000 ounces of gold, worth between $949 million and $1.03 billion.
Yet there is some doubt from analysts. El Dorado Gold stock is currently classified as a Hold, with three Hold ratings and one Sell. Worse, its average share price target of $10.83 gives it 2.17% downside risk as well.
