Mining Their Own Business: Agnico-Eagle Mines Limited (USA) (AEM)

Forecasted production

A mining company’s outlook for production is vital for investors. In 2013, Agnico-Eagle expects payable gold production to be within the range of 970,000 ounces to 1,010,000 ounces. In 2014, the company expects payable gold production to be in the range of 1,100,000 ounces to 1,140,000 ounces. In 2015, they expect payable gold production to be greater than 1,200,000 ounces.

Newmont Mining expects 2013 attributable gold production to be approximately 4.8 million to 5.1 million ounces. Newmont reported attributable gold production of 5.0 million ounces in 2012. Investors should consider a company’s potential for increasing their gold production, as is the case with Agnico-Eagle.

Cash flow and dividends

Agnico-Eagle Mines Limited (USA) (NYSE:AEM) had record annual operating cash flows for full year 2012. Cash provided by operating activities was up year-over-year, to $696 million ($4.06 per share). In 2001, they had cash provided by operating activities of $667.2 million. It’s important because significant cash flows from operating activities means a company can most likely refrain from or limit their need for external funding. In essence, they’re financing themselves and can carry on with their operating initiatives.

Investors should consider dividend-paying stocks as a security blanket against stock price volatility and as a component of an investment’s total return. Agnico-Eagle has declared a dividend for 31 consecutive years. Their fourth quarter and full year 2012 highlights include their quarterly dividend up 10% to $0.22 per share. Newmont’s 2012 financial results included record regular dividends paid to shareholders of $695 million ($1.40 per share). In February, their board of directors declared a quarterly dividend of $0.425 per share of common stock.

It seems like it’s early to bed and early to rise for Agnico-Eagle Mines. Agnico-Eagle Mines is a stock to consider as you roll out of bed and ponder the day’s investing opportunities. They’re mining their own business, and more gold production down the line is certainly a wake up call investors may want to answer.

The article Mining Their Own Business originally appeared on Fool.com.

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