Agnico Eagle Mines Ltd (NYSE:AEM) Matches Louis Navellier’s High-Growth Stock Criteria

Louis Navellier’s The Little Book That Makes You Rich presents an eight-rule system for finding high-growth stocks with solid earnings momentum, profitability, and financial stability. The approach highlights stocks with rising earnings revisions, positive surprises, faster revenue and earnings growth, wider margins, strong cash flow, and high returns on equity. These factors help identify companies likely to perform well over time by focusing on core strength and momentum.

Agnico Eagle Mines Ltd (NYSE:AEM) appears as a potential match for many of these growth-focused measures. The gold mining firm has shown clear progress in profitability, cash flow, and operational efficiency, traits Navellier values. Here’s a look at how AEM matches the Little Book’s standards.

Key Growth and Momentum Measures

• Earnings Revisions & Surprises: Analysts have increased next-quarter EPS estimates by 43% in the last three months, showing rising confidence in short-term earnings. AEM has also exceeded EPS estimates in each of the past four quarters by an average of 11%, supporting Navellier’s focus on steady earnings success.
• Revenue and Earnings Growth: Year-over-year revenue growth is 25%, while quarterly sales growth rose to 35.6%. EPS growth is even stronger, with a 106.7% year-over-year jump and an 81.3% quarterly gain, showing faster profit growth.
• Operating Margin Growth: Operating margins grew by 57.2% over the past year, indicating better cost control and pricing ability. This fits Navellier’s preference for firms where profit growth outpaces revenue.
• Solid Cash Flow: Free cash flow climbed 282% year-over-year, demonstrating AEM’s skill in turning earnings into usable funds, a key factor for ongoing growth and shareholder benefits.
• High Return on Equity (ROE): With an ROE of 10.9%, AEM beats 80% of its industry peers, meeting Navellier’s standard for effective capital use.

Fundamental Strength and Valuation

Agnico Eagle’s fundamental report rates it 7/10, showing strong profitability (9/10) and good financial health (7/10). Key positives include:

• Profitability: Top-tier operating margins (42.2%) and ROE, backed by careful cost control.
• Balance Sheet Health: Low debt-to-equity (0.05) and a high Altman-Z score (5.09) point to low bankruptcy risk.
• Valuation: With a P/E of 21.3, AEM is more affordable than 73% of its peers and the broader S&P 500 (P/E 26.8).

Why Growth Investors Should Take Note

Navellier’s method looks for firms where better fundamentals lead to higher earnings revisions and price momentum. AEM’s strong cash flow, margin growth, and faster earnings suggest it fits this profile. While gold mining is cyclical, AEM’s operational efficiency and low debt help it benefit from commodity price gains while reducing risks.

For investors searching for similar high-growth options, the Little Book screener provides an updated list of stocks meeting these conditions.

Disclaimer: This analysis is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence or consult a financial advisor before making decisions.