What's Driving Anglogold Ashanti PLC's Surprising 18% Stock Rally?

Anglogold Ashanti PLC (AU, Financial), a prominent player in the metals and mining industry, has experienced a notable uptick in its stock performance. With a current market capitalization of $8.23 billion, the company's shares are trading at $19.61. Over the past week, the stock has seen a gain of 6.71%, and over the past three months, it has surged by 17.75%. This growth trajectory is underscored by the company's GF Value, which stands at $22.58, indicating that the stock is modestly undervalued. This valuation has remained consistent, with the past GF Value also suggesting a modest undervaluation at $22.52.

Introduction to Anglogold Ashanti PLC

Anglogold Ashanti PLC is a gold mining enterprise with a significant presence in Africa, including operations in Ghana, Guinea, Mali, the Democratic Republic of the Congo, and Tanzania. The company also produces silver and sulphuric acid as by-products. Its diversified operations across Africa, Australia, and the Americas contribute to a robust revenue stream, primarily driven by its African ventures. 1740029115722952704.png

Assessing Profitability

Anglogold Ashanti's financial health is reflected in its Profitability Rank of 7/10, which is a strong indicator of the company's ability to sustain its business over time. The company's Operating Margin stands at 13.68%, outperforming 76.17% of 856 companies in the industry. Additionally, the ROE is at 0.94%, higher than 80.16% of 2480 companies, while the ROA at 0.48% surpasses 81.5% of 2686 companies. The ROIC of 2.94% also indicates a better performance than 86.14% of 2656 companies. Over the past decade, Anglogold Ashanti has maintained profitability for five years, which is more consistent than 68.66% of 1203 companies in the same space. 1740029134567960576.png

Growth Prospects

The company's Growth Rank is 6/10, reflecting a balance between its revenue and profitability expansion. Anglogold Ashanti's 3-Year Revenue Growth Rate per Share is 8.50%, which is more favorable than 41.6% of 589 companies in the industry. The 5-Year Revenue Growth Rate per Share is 6.50%, outpacing 44.57% of 516 companies. Looking ahead, the Total Revenue Growth Rate (Future 3Y To 5Y Est) is projected at 3.32%, which is better than 45.81% of 155 companies. The 3-Year EPS without NRI Growth Rate stands at an impressive 12.30%, surpassing 51.75% of 1747 companies, while the 5-Year EPS without NRI Growth Rate is a remarkable 74.00%, exceeding 98.84% of 1377 companies. 1740029152280506368.png

Notable Shareholders

Anglogold Ashanti's shareholder base includes several prominent investors. Howard Marks (Trades, Portfolio) holds 5,428,819 shares, representing a 1.29% stake in the company. John Paulson (Trades, Portfolio) owns 3,833,492 shares, accounting for 0.91% of the company's shares. First Eagle Investment (Trades, Portfolio) has a stake of 0.35%, with 1,456,138 shares. These significant shareholders reflect confidence in the company's long-term value proposition.

Competitive Landscape

When compared to its peers, Anglogold Ashanti holds its ground in the competitive metals and mining industry. Royal Gold Inc (RGLD, Financial) has a market cap close to Anglogold's at $8.15 billion. Coeur Mining Inc (CDE, Financial) and Seabridge Gold Inc (SA, Financial) have market caps of $1.33 billion and $1.07 billion, respectively, indicating a smaller scale of operations compared to Anglogold Ashanti.

Conclusion

In summary, Anglogold Ashanti PLC's stock performance has been robust, with a significant gain over the past three months and a current valuation that suggests the stock is modestly undervalued according to the GF Value. The company's profitability and growth prospects are solid, with a strong Profitability Rank and promising growth rates. The presence of notable shareholders adds to the company's credibility. When juxtaposed with its competitors, Anglogold Ashanti demonstrates a competitive edge in market capitalization and financial health. These factors collectively contribute to the positive outlook for Anglogold Ashanti PLC, making it a noteworthy consideration for value investors.

This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.

Disclosures

I/We may personally own shares in some of the companies mentioned above. However, those positions are not material to either the company or to my/our portfolios.