September’s inflation came in hotter than expected. The U.S. consumer price index (CPI) gained 8.2% relative to a year earlier. Moreover, economies worldwide are experiencing…
price rises. According to the International Monetary Fund (IMF), global inflation could rise from 4.7% in 2021 to 8.8% in 2022.
Conventionally, gold is seen as an inflation hedge as the yellow metal tends to hold its value better than other assets in the long run.
Although gold prices have taken a hit due to the strengthening dollar and rising treasury yields and are trading at $1,627.81 per ounce, the global delegates meeting at the London Bullion Market Association’s annual precious metals conference predicted that the metal’s prices would rise to $1,830.50 per ounce in a year’s time.
Gold Fields Limited (GFI)
Based in Sandton, South Africa, GFI is a gold producer that operates reserves and resources in Chile, South Africa, West Africa, Australia, and Peru. The company also engages in the exploration of copper deposits.
On October 4, the company updated investors on its proposed acquisition of all the outstanding common shares of Yamana Gold Inc. (AUY). GFI intends to hold a general meeting on November 22 with shareholders. The proposed acquisition should enhance the company’s operative capability significantly.
In September, the company announced that its wholly-owned indirect holding subsidiary, Gold Fields Atacama Holdings, had purchased 15 million common shares in the capital of Torq Resources Inc., representing approximately 15.05% of the issued and outstanding Torq Shares. This should be beneficial for GFI.
For the six months that ended June 2022, GFI’s revenue increased 12.7% year-over-year to $2.24 billion. Normalized profit attributable to owners of the parent rose 15.8% from the prior-year period to $498.40 million. Normalized profit per share attributable to owners of the parent came in at 56 cents, up 14.3% from the same period the prior year.
Analysts expect GFI’s EPS to come in at $0.80 for the fiscal year ending December 2023. Street expects a marginal year-over-year increase in its revenue for the same year to $4.15 billion.
The stock has declined…
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