Equity Profile

HMY

Harmony Gold Mining Company Limited

MaterialsGold$12.0B

Aug21Tue

Pre-Earnings Brief

UpcomingQ3-2016Pre-Market9:00 AM EDT

Company Snapshot

Harmony Gold Mining Company Limited is a major player in the gold mining industry, focusing on the extraction and production of gold. With a market cap of $12 billion, it operates in a sector that is often influenced by global economic conditions and commodity prices, making it a significant entity in the materials sector.

Key Metrics to Watch

Gold Production

This metric indicates the company's operational efficiency and ability to generate revenue from its mining activities.

Not available

Cost per Ounce

Understanding the cost structure is crucial for assessing profitability, especially in a fluctuating gold price environment.

Not available

1 more metrics, Wall Street expectations, options signals, track record, and call prep available with Pro.

HMY Q3-2016 Earnings Preview

Context

Company Snapshot

Earnings Scorecard·Last 8Q

EPS Beat Streak

EPS Beat Rate

13%

Avg EPS Surprise

+3.13%

Avg Stock Reaction

+0.13%

Last Quarter Recap

In the last quarter, Harmony Gold reported an earnings per share (EPS) of $0.01, which was a slight improvement compared to previous quarters. The stock reacted positively, increasing by 9.27% the following day.

Management Promises & Guidance

Expectations

Wall Street Expectations

Overall, analysts and investors are cautiously optimistic about Harmony Gold's upcoming earnings, particularly given its recent performance. However, the lack of specific analyst estimates adds an element of uncertainty.

Bull Case

If Harmony Gold can demonstrate strong gold production and manage costs effectively, it could see a significant boost in its stock price, reflecting investor confidence.

Bear Case

Conversely, if the company reports higher costs or lower production than expected, it could lead to a decline in stock price, especially given the volatility in gold prices.

Expectations

Two Questions That Matter

The print will turn on these two things.

What is the gold production figure for this quarter?

Gold production levels are critical for assessing the company's operational performance and revenue potential.

What is the cost per ounce of gold produced?

Understanding the cost structure will help investors gauge profitability and the company's ability to navigate fluctuating gold prices.

Edge

What the Street Is Missing

Why consensus could be wrong

The Street may be underestimating the impact of rising gold prices on Harmony Gold's profitability this quarter.

Supporting Evidence

Recent trends in gold prices have shown significant increases, which could enhance margins.

Options pricing indicates a higher expected volatility, suggesting that traders are anticipating a more significant move than historical averages.

The company's operational improvements may not be fully reflected in current market expectations.

Key Risk

If gold prices rise above $1,500 per ounce, it could significantly alter the profit outlook.

Edge

Thesis-Break Levels

Pre-commit to what would confirm each case.

The core debate this quarter revolves around production efficiency and cost management in a volatile gold market.

Bull Confirmed If

Gold production exceeding 300,000 ounces this quarter would support a bullish outlook.

Bear Confirmed If

If the cost per ounce exceeds $1,200, it could signal a bearish trend.

Pre-Earnings Positioning

Options Market

Implied Move

±5.1%

Historical Avg

±3.9%

Pricing rich

The options market is pricing in a potential move of about 5.1%, indicating that traders expect some volatility around the earnings announcement.

Options are pricing ±5.1% while HMY has averaged ±3.9% over the last 8 prints — setup is pricing rich.

Detail

ATM IV

0.6%

30d HV

69.7%

Calls (701K)P/C Ratio: 0.79Puts (9K)

Preparation

Post-Print Playbook

Likely market behavior by outcome — not investment advice.

Beat & Raise

If Harmony Gold beats expectations, history suggests a potential stock increase of around 3.49%, confirming a positive operational trend.

In-Line / Cautious

If results come in line with expectations, the market may react cautiously, leading to minimal movement as investors await further guidance.

Miss

A miss could lead to a decline in stock price, with historical patterns indicating an average drop of around 4.17%.

Earnings Track Record

Preparation

What to Listen For

Call Prep

1Details on gold production levels and any operational challenges faced.
2Insights into cost management and how it affects profitability.
3Any updates on future production guidance or strategic initiatives.
4Management's outlook on gold market trends and pricing.
5Responses to questions about the company's financial health and cash flow.

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Company Snapshot

Key Metrics to Watch

Gold Production

This metric indicates the company's operational efficiency and ability to generate revenue from its mining activities.

Not available

Cost per Ounce

Understanding the cost structure is crucial for assessing profitability, especially in a fluctuating gold price environment.

Not available

1 more metrics, Wall Street expectations, options signals, track record, and call prep available with Pro.

HMY Q3-2016 Earnings Preview

Context

Company Snapshot

Earnings Scorecard·Last 8Q

EPS Beat Streak

EPS Beat Rate

13%

Avg EPS Surprise

+3.13%

Avg Stock Reaction

+0.13%

Last Quarter Recap

Management Promises & Guidance

Expectations

Wall Street Expectations

Bull Case

If Harmony Gold can demonstrate strong gold production and manage costs effectively, it could see a significant boost in its stock price, reflecting investor confidence.

Bear Case

Conversely, if the company reports higher costs or lower production than expected, it could lead to a decline in stock price, especially given the volatility in gold prices.

Expectations

Two Questions That Matter

The print will turn on these two things.

What is the gold production figure for this quarter?

Gold production levels are critical for assessing the company's operational performance and revenue potential.

What is the cost per ounce of gold produced?

Understanding the cost structure will help investors gauge profitability and the company's ability to navigate fluctuating gold prices.

Edge

What the Street Is Missing

Why consensus could be wrong

The Street may be underestimating the impact of rising gold prices on Harmony Gold's profitability this quarter.

Supporting Evidence

Recent trends in gold prices have shown significant increases, which could enhance margins.

Options pricing indicates a higher expected volatility, suggesting that traders are anticipating a more significant move than historical averages.

The company's operational improvements may not be fully reflected in current market expectations.

Key Risk

If gold prices rise above $1,500 per ounce, it could significantly alter the profit outlook.

Edge

Thesis-Break Levels

Pre-commit to what would confirm each case.

The core debate this quarter revolves around production efficiency and cost management in a volatile gold market.

Bull Confirmed If

Gold production exceeding 300,000 ounces this quarter would support a bullish outlook.

Bear Confirmed If

If the cost per ounce exceeds $1,200, it could signal a bearish trend.

Pre-Earnings Positioning

Options Market

Implied Move

±5.1%

Historical Avg

±3.9%

Pricing rich

The options market is pricing in a potential move of about 5.1%, indicating that traders expect some volatility around the earnings announcement.

Options are pricing ±5.1% while HMY has averaged ±3.9% over the last 8 prints — setup is pricing rich.

Detail

ATM IV

0.6%

30d HV

69.7%

Calls (701K)P/C Ratio: 0.79Puts (9K)

Preparation

Post-Print Playbook

Likely market behavior by outcome — not investment advice.

Beat & Raise

If Harmony Gold beats expectations, history suggests a potential stock increase of around 3.49%, confirming a positive operational trend.

In-Line / Cautious

If results come in line with expectations, the market may react cautiously, leading to minimal movement as investors await further guidance.

Miss

A miss could lead to a decline in stock price, with historical patterns indicating an average drop of around 4.17%.

Earnings Track Record

Preparation

What to Listen For

Call Prep

1Details on gold production levels and any operational challenges faced.
2Insights into cost management and how it affects profitability.
3Any updates on future production guidance or strategic initiatives.
4Management's outlook on gold market trends and pricing.
5Responses to questions about the company's financial health and cash flow.