Is Agnico Eagle Mines Limited (AEM) overvalued?
On Equity Rank's model estimate, AEM trades 15% above its fair value. Agnico Eagle Mines Limited (AEM) last closed at $191.57; the multi-method model fair value is $166.75.
| Price | Model fair value | Price vs model |
|---|---|---|
| $191.57 | $166.75 | 15% above |
What the answer rests on
- 1 of 12 valuation methods put AEM's value above its price and 11 put it below, so the methods mostly agree.
- To justify today's price, AEM's free cash flow would need to grow about 4.5% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew 96.9% a year.
- AEM trades at 14.9 times its last year's earnings, against a median of 12.1 for 36 profitable Mining companies.
- Over the past year the price sat below the model fair value on 28% of trading days. The gap ranged from 22% below to 44% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind AEM's fair value · What prices assume · Other companies