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What Are Analysts’ Estimates for Gold Miners’ Future Earnings?

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Analysts’ earnings expectations

Now that we’ve considered analysts’ revenue estimates for the senior gold miners under review (GDX) in this series, let’s take a look at analysts’ EBITDA estimates.

Along with the expected fall in Barrick Gold’s (ABX) 2018 revenue, analysts expect a fall in its EBITDA. The expected fall in its EBITDA, however, is much larger. ABX’s EBITDA is expected to fall 26.4% YoY (year-over-year) to $2.96 billion, most likely due to higher estimates for its costs, in line with the actual cost increases recorded by the company.

Newmont Mining’s (NEM) EBITDA is expected to fall 12.8% YoY to $2.3 billion in 2018. As we learned in the previous article, Newmont expects to see a fall in production and a YoY rise in costs in 2018, driving its EBITDA to fall more quickly than its revenue.

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Kinross Gold and Goldcorp

In contrast to other miners, the expected fall in Kinross Gold’s (KGC) EBITDA in 2018 is much lower. Analysts expect KGC’s EBITDA to fall 0.9% to $1.07 billion in 2018. However, this is after downgrades by analysts following its weaker-than-expected performance year-to-date. It’s expected to report a margin of 33.3% in 2018 compared to 32.8% in 2017.

For Goldcorp (GG), analysts expect a fall of 16% YoY. Analysts’ estimates took a hit after Goldcorp lowered its production guidance and increased its cost guidance in its third-quarter results. If the company is able to deliver on its guidance for next year, then according to analysts’ expectations, it could see a 50% rise in EBITDA in 2019.

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