Valued at a market cap of over $100 billion, Agnico Eagle (TSX:AEM) is a gold mining firm engaged within the exploration, improvement, and manufacturing of valuable metals. The miner explores for gold, silver, zinc, and copper.
Its mines are situated in Canada, Australia, Finland, and Mexico, with exploration and improvement actions in Canada, Australia, Europe, Latin America, and the US.
Rising gold costs have enabled the TSX mining inventory to achieve almost 300% during the last three years. Let’s see if Agnico Eagle inventory continues to be a great purchase in September 2025.
Is the TSX inventory undervalued in 2025?
Agnico Eagle delivered stable second-quarter outcomes, producing 866,000 ounces at industry-leading all-in sustaining prices of US$1,289 per ounce whereas producing file free money stream of US$1.3 billion.
By way of market cap, Agnico is the second-largest gold producer globally. Its regional consolidation technique continues to show profitable, significantly in its Abitibi platform, which spans Northern Ontario and Quebec, and produced over a million ounces within the first half at money prices of simply US$850 per ounce.
This 73% working margin displays the aggressive benefits Agnico has constructed via many years of regional experience, established provider networks, and worker retention charges half the {industry} common.
Administration’s 5 key worth drivers point out substantial development potential, with tasks able to including 1.3 to 1.5 million ounces of gold yearly. The Canadian Malartic advanced leads this pipeline, concentrating on a million ounces per yr by 2030 via underground growth and the event of satellite tv for pc deposits.
The underground Odyssey venture has grown from zero to over 20 million ounces since 2018, whereas infill drilling continues increasing the useful resource base.
Agnico’s steadiness sheet energy offers strategic flexibility, because it ended Q2 with almost US$1 billion in internet money after repaying US$550 million in debt.
The corporate has returned US$300 million to shareholders via dividends and buybacks, sustaining its 42-year consecutive streak of dividend funds whereas doubling its share repurchase exercise.
What’s the AEM inventory value goal?
Agnico Eagle’s US$525 million exploration program, that includes 121 energetic drill rigs, continues to ship spectacular outcomes. With gold costs close to file highs and peer-leading value efficiency, Agnico Eagle seems well-positioned to capitalize on beneficial market circumstances whereas constructing long-term worth via disciplined capital allocation and operational excellence.
Analysts monitoring Agnico Eagle inventory forecast adjusted earnings per share to extend from US$4.23 per share in 2024 to US$7.28 per share in 2025. Nevertheless, it’s forecast to slender to US$6.34 per share if gold costs transfer decrease.
At present, AEM inventory trades at 20 occasions ahead earnings, which is marginally beneath its five-year common of 21.4 occasions. So, if the TSX inventory is priced at 21.4 occasions earnings, it ought to commerce 10% beneath present ranges in early 2028.
Within the occasion AEM inventory declines, it’s going to present traders with a chance to achieve publicity to a high quality firm at a decrease valuation a number of. AEM additionally pays shareholders an annual dividend at $1.46 per share, indicating a yield of 1%. Wall Avenue expects the annual dividend to extend to $1.60 per share in 2028.
