Glencore PLC (GLEN.L, Financial) experienced a 3% downtrend in market value to around $4.26 per share on the London Stock Exchange. The decline was blamed on the timing of some shipments and a decline of 32,000 ounces in the sales volume of copper.
Glencore delivered in the first six months of the year an 8% increase in copper production of 696,200 tons and a 31% increase in the cobalt production of 16,700 tons. The production quantities were drawn from operations at Katanga in the Democratic Republic of Congo. At 498,200 tons, the production of zinc for the first half of 2018 was on par with the corresponding period of 2017.
With the addition of a second production line at Koniambo in New Caledonia, the mining company could achieve a 21% increase in the production of nickel to 62,200 tons of metal milked from its own mineral deposits.
The company produced 818,000 tons of attributable ferrochrome.
Despite Cyclone Debbie in Australia and the removal of significant overburden material at Prodeco in Colombia, Glencore didn’t post a decline in the coal production. At 62 million tons, it was on par with the output of the first half of 2017. The recent acquisition of Hunter Valley Operations JV in the Australian New South Wales was supportive.
Despite the positive contribution from the oil drilling campaign in Chad, underperforming offshore fields in the Equatorial Guinea caused a 13% decrease in the entitlement interest oil production to 2.3 million barrels.
Looking ahead, Glencore predicts to deliver about 1.465 million tons of copper, 39,000 tons of cobalt, 1.09 million tons of zinc, 285,000 tons of lead, 132,000 tons of nickel, 1.6 million tons of ferrochrome, 132 million tons of coal and about 4.9 million barrels of oil in full fiscal 2018.
Because of some adjustments at operations in South America and South Africa, Glencore revised the guidance on lead and coal productions a bit lower than the previous forecast. Lead is now forecasted to be 5% lower and coal is predicted to be 1% lower than initial guidance.
The stock in Glencore has a market capitalization of $60.58 billion, a price-book ratio of 93.12 times, a price-sales ratio of 0.22 times and an EV-to-Ebitda of 6.64 times. The EV-to-Revenue is 0.38 times.
The 52-week range is $3.98 to $5.47 per share.
For the 52 weeks through July 31, the stock in Glencore has fallen 6.3% and is trading below the 50-SMA line value of $4.64, the 100-SMA line value of $4.72 and the 200-SMA line value of $4.83.
The company has a forward annual dividend of 14 cents, granting 4.38%.
The recommendation rating is 2 out of 5 and the average target price is $5.68 per share.
(Disclosure: I have no positions in Glencore Plc.)
