AEM's Reserve Growth Spurs Confidence: Can It Keep Drilling Success?

Agnico Eagle Mines Limited AEM made substantial efforts in the first quarter for the continuation of its mineral reserve replacement, a critical metric reflecting growth potential. At the end of 2024, AEM boosted its proven and probable gold reserves by 0.9% year over year to 54.3 million ounces. More notably, inferred mineral resources expanded around 9% to 36.2 million ounces, thanks to successful exploration drilling at Detour Lake, East Gouldie, Hope Bay, Meliadine, Fosterville and Macassa.
Year-end expansion set a strong foundation, and the first quarter of 2025 saw further progress as drilling campaigns advanced key projects. During the quarter, AEM continued exploration drilling to extend the East Gouldie deposit at Canadian Malartic to the east and extend the newly discovered Eclipse zone. Underground conversion drilling into the upper eastern extension of the East Gouldie deposit also indicated potential to add mineral resources and mineral reserves to East Gouldie by the end of 2025.
At Hope Bay, shallow drilling at Patch 7 also suggests the potential for mineral resource expansion. Drilling at the Marban deposit, added through the acquisition of O3 Mining, also focuses on mineral reserve and mineral resource expansion.
Agnico Eagle's initiatives in expanding its reserve base and inferred resources position it as a growth-oriented player among major peers. Maintaining drilling pace and converting potential into formally declared reserves through 2025 will be key, as it constitutes a critical barometer for long-term growth.
Among its peers, Newmont Corporation NEM logged gold reserves of 134.1 million attributable ounces at the end of 2024 (including assets held for sale), a 1.3% decline from 135.9 million attributable ounces a year ago, weighed down by depletion and unfavorable revisions. Newmont's go-forward Tier 1 portfolio included 125.5 million attributable gold ounces. While Newmont's overall reserve base remains substantial, the lack of growth raises red flags.
Barrick Mining Corporation B reported robust growth in reserves, with its proven and probable gold mineral reserves climbing approximately 17.4 million ounces in 2024, a clear sign of strong reserve replacement. Barrick's attributable proven and probable mineral reserves were at 89 million ounces at the end of 2024, up from 77 million ounces a year ago. Barrick demonstrates proactive exploration and conversions, insulating its reserve profile from near-term production drawdowns.
The Zacks Rundown for AEM
Agnico Eagle's shares have rallied 56.8% year to date against the Zacks Mining – Gold industry's rise of 56.4%, driven by the record-setting upside in gold prices.
From a valuation standpoint, AEM is currently trading at a forward 12-month earnings multiple of 20.27, a roughly 42.6% premium to the industry average of 14.21X. It carries a Value Score of C.
The Zacks Consensus Estimate for AEM's 2025 and 2026 earnings implies a year-over-year rise of 42.6% and 0.8%, respectively. The EPS estimates for 2025 and 2026 have been trending higher over the past 60 days.
AEM stock currently carries a Zacks Rank #3 (Hold).
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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