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Agnico Eagle Mines Ltd (USA) (NYSE:AEM) Updates on Mining Operations in Mexico

Agnico Eagle Mines Ltd (USA) (NYSE:AEM) has released updates on its mining activities in Mexico. The company reported expansion in known deposits at El Barqueno, with the declaration the first resources by February 2016. However, like most stocks in the mining industry, AEM experienced a sudden decline in terms of share price, as gold prices started to fall. The downward trend in gold prices is expected to continue as the US dollar gains strength.

The CEO of Agnico, Sean Boyd, stated that the company has decided to develop an open pit mine at El Barqueno, based on studies conducted to date. He also praised the efforts of workers at Creston Mascota and La India for successful operations in the region. The CEO also expressed hope that the El Barqueno mine would be just as successful as its predecessors.

The region around El Barqueno has known mineral deposits, with a number of prospects still under evaluation. The company has committed a total of 10 rigs to the project and dug 148 holes so far. This also includes holes made to explore for additional mineral structures and extensions. Year-to-date expenses on the mine, currently, stand at an estimate of $22 million.

Analysts believe that gold prices would hold for the rest of the year, with very little fluctuation. However, once the Federal Reserve decides to raise interest rates in December, gold will start on its path to a steep decline. The most recent 10-Q filing by AEM suggested that the company’s revenue growth exceeded that of the industry average, but there has been a decline in EPS. Furthermore, the company’s debt to equity ratio stood at 0.29, which is significantly lower than the industry average and indicates effective management of debt levels. Despite the fact that the EPS for AEM has declined by 75% over the past year, analysts at the Street Ratings have given the stock a hold rating.

Agnico Eagle Mines Ltd (USA) (NYSE:AEM) experienced a trade volume of 400 shares, during the September 23 session, to close at a share price of $23.12 after gaining 0.39% during the session.

Published by Steve Hackney

Steve Hackney is a corporate finance professional with over 14 years of experience in cash management and investing. He earned a Bachelor of Science in Finance from Florida State University and holds a Certified Treasury Professional certification. Steve lives in Orlando, Florida with his family.

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