| BHP Billiton Boosts Growth on Higher Yield, Runs Risks - Analyst Blog | |
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On Mar 19, 2015, we issued an updated research report on premium basic materials company, BHP Billiton Limited BHP. The company is one of the world’s largest diversified resource firms with operations spanning over several continents. It is involved in mineral exploration, production & processing, oil and gas exploration and development, and steel production. However, irrespective of success in global trade, the company faces threats from external market headwinds. Scopes for Improvement
BHP Billiton reported record yields in eight operational facilities and five commodities at the end of first-half fiscal 2015. The improvement was achieved on the back of efficient output gained from the company’s Queensland and Illawarra coal mines as well as superior smelting activities. We believe that supported by such productivity in business, the company would report higher revenues, going ahead.
The company aims to further improve its business yield in the near term through portfolio simplification initiatives. Moreover, the company implements a progressive dividend policy within its business, reflecting its commitment to increase shareholders’ wealth. However, in order to sustain the lucrative dividend policy, BHP Billiton needs to maintain a superior system of capital management. By investing funds in high-return growth opportunities, the company aims to offer attractive share buyback and dividend return programs to its shareholders in the near future.
Existing Business Issues
BHP Billiton’s financial results for first-half fiscal 2015 failed to impress investors. Certain market headwinds, like price inflation of major commodities, were primarily responsible for the year-over-year downfall in revenues and earnings. As a result of such unfavorable business environment as well as certain external negativities such as equipment shortage and labor crisis, the company anticipates reporting weaker results in the upcoming quarters.
Also, volatile prices of metals as well as minerals are augmenting its operating expenses. At the same time, depleting natural resources call for an improvement in ore quality and subsequent search for new mines. These factors will likely raise the company’s exploration and development costs in the near term. Further, BHP Billiton renders commercial services in diversified geographical locations, which exposes it to currency and exchange rate risks. Unfavorable fluctuation in these macroeconomic indicators can severely impact the company’s profitability.
With a market capitalization of $123.89 billion, BHP Billiton currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry include Denison Mines Corp. DNN, Golden Minerals Company AUMN and McEwen Mining Inc. MUX. All three stocks hold a Zacks Rank #2 (Buy). Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report BHP BILLITN LTD (BHP): Free Stock Analysis Report GOLDEN MINERALS (AUMN): Free Stock Analysis Report DENISON MINES (DNN): Free Stock Analysis Report MCEWEN MINING (MUX): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research
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McEwen Mining Inc
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PRODUCER |
CODE : MUX |
ISIN : US58039P1075 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
McEwen Mining is a gold and silver producing company based in Canada. McEwen Mining holds various exploration projects in Mexico. Its main assets in production are MAGISTRAL MINE in Mexico and SAN JOSE ARGENTINA in Argentina, its main asset in development is EL GALLO MEXICO in Mexico and its main exploration properties are PALMARITO, GOLD PICK AND GOLD RIDGE, TONKIN PROJECT and MAGISTRAL in Mexico and LOS AZULES ARGENTINA and LIMO in Argentina. McEwen Mining is listed in Canada, in Germany and in United States of America. Its market capitalisation is US$ 2.8 billions as of today (€ 2.6 billions). Its stock quote reached its lowest recent point on July 29, 2022 at US$ 0.32, and its highest recent level on July 19, 2024 at US$ 9.99. McEwen Mining has 337 054 594 shares outstanding. |