Acacia Mining Plc: Gathering momentum, can it sustain its performance?

Acacia Mining Plc relative valuation is UNDERVALUED and it has a fundamental analysis score of 78.

Our analysis is based on comparing Acacia Mining Plc with the following peers – Agnico-Eagle Mines Limited, Royal Gold, Inc., New Gold Inc., Asanko Gold, Inc., IAMGOLD Corporation, Barrick Gold Corporation, Compania de Minas Buenaventura SAA Sponsored ADR, Harmony Gold Mining Co. Ltd. Sponsored ADR, Golden Star Resources Ltd. and Kinross Gold Corporation (AEM-US, RGLD-US, NGD-US, AKG-US, IAG-US, ABX-US, BVN-US, HMY-US, GSS-US and K-CA).

Acacia Mining Plc has shown underwhelming performance over the last one year while growing strongly over the last month. Acacia Mining Plc’s price momentum over the last month, at 16.31% has been better than that over the last year, which was -52.06%. Also from a peer group perspective, Acacia Mining Plc has performed better, since the peer group performance was -4.73% over the last month.

Company Snapshot

  • Compared to peers, relative underperformance over the last year is in contrast with the more recent outperformance.
  • It trades at a lower Price/Book multiple (0.61) than its peer median (1.05).
  • We classify ABGLY-US as Harvesting because of the market’s relatively low growth expectations despite its relatively high returns.
  • ABGLY-US has relatively high profit margins while operating with median asset turns.
  • The company’s year-on-year change in revenues and earnings are better than the median among its peer group.
  • Over the last five years, ABGLY-US’s return on assets has improved from below median to better than the median among its peers, suggesting that the company has improved its relative operations markedly.
  • The company’s relatively high gross and pre-tax margins suggest a differentiated product portfolio and tight control on operating costs relative to peers.
  • While ABGLY-US’s revenue growth in recent years has been above the peer median, the stock’s P/E ratio is less than the peer median suggesting that the company’s earnings may be peaking and the market expects a decline in its growth expectations.
  • The company’s level of capital investment seems appropriate to support the company’s growth.
  • ABGLY-US has the financial and operating capacity to borrow quickly.
  • Our analysis rates Acacia Mining Plc as UNDERVALUED relative to its peers.

Share Price Performance

Compared to peers, relative underperformance over the last year is in contrast with the more recent outperformance.

ABGLY-US’s share price performance of -52.06% over the last 12 months is below its peer median but its 30-day trend in share price performance of 16.31% is better than the peer median. This recent rising stock price may herald a change in relative share price performance.

Share Price Performance

Quadrant label definitions. Hover to know more

Leading, Fading, Lagging, Rising

Relative Valuation

Relative Valuation
Fundamental Score

Acacia Mining Plc’s price of USD 5.60 is lower than CapitalCube’s implied price of USD 11.11. CapitalCube believes that at these levels, Acacia Mining Plc is undervalued and has upside potential. Over the last 52 week period, the stock has fluctuated between USD 4.12 and USD 13.53.

Valuation & Peer Metrics

A complete list of valuation metrics is available on the company page.

Company Profile

Acacia Mining Plc is a holding company, which engages in mining, processing, and sale of gold. It operates through the following segments: North Mara, Bulyanhulu, Buzwagi, and Other. The company was founded in March 1999 and is headquartered in London, United Kingdom.

Disclaimer

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