Agnico-Eagle Mines Ltd., (AEM.TO) Canada's fifth-biggest gold producer, is outperforming global competitors including Barrick Gold Corp. (ABX.TO) after overcoming weather conditions at its Arctic mine that sent costs soaring, Bloomberg reported.
Agnico has surged 38% in 2012, the biggest gain among 17 gold miners larger than $7 billion, according to data compiled by Bloomberg. The company beat earnings estimates for three straight quarters and now trades at a peer-leading price-to-earnings ratio of 33 times.
The company's performance is at odds with the rest of the gold industry. The S&P/TSX Global Gold Sector Index of 55 companies has slumped 18% this year while gold prices are up 6.6% in New York. Barrick and Newmont Mining Corp. are among miners saddled with cost inflation that outpaces the price of the metal.
The Toronto-based company's successes can be attributed partly to improved production and lowered costs at Meadowbank, Canada's most northerly gold mine. Output at the operation, now Agnico's top producer, reached a record in the third quarter, 42% higher than a year earlier, while costs fell 29%.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
