GRS Investment Analysis Report & Stock Research, Gammon Gold, Inc.

Gammon Gold, Incorporated (GRS)

GRS Stock Report

2-Year Price History

View Larger GRS Chart
NYSE:GRS
$8.95
(3/18 1:20PM)
-0.6%
Open$9 Mkt Cap$1.1 Billion
High$9.11 52Wk High$12.63
Low$8.8 52Wk Low$5.81
Volume521,768 Avg Vol 10D1.2 Million

Ockham's Rating/Recommendation Summary

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GRS Revenue

Cash earnings is the most important factor in our analysis, but it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company's stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 5 years. For, GRS the high and low end of the Price to Sales per share ratios are 12.72x and 4.53x respectively.

Notice that GRS's current Price to Sales per share ratio is 5.89x, which is quite a bit below what we consider a normal Price to Sales ratio for this stock. Given normal conditions and a price of $9.19, GRS is 32% below where we would expect to see it. This will beneficially factor into our final analysis of GRS as it is not often that this stock sinks to these levels.

GRS Cash Earnings

When there is not enough positive Cash Earnings history available for a company, we at Ockham Research can find it quite difficult to actually rate their ability to generate cash. Such is the case with GRS. When a company has current positive cash earnings but not enough years of history to compare it to, we find the correlation of cash earnings to valuation significantly hindered. So with GRS, we will have to wait to see if there are a few more cycles of positive Cash Earnings numbers before we will be confident in our Cash Earnings analysis.

GRS Dividends

While it is not necessary to pay an attractive dividend or a dividend at all, to receive a positive rating from Ockham, we view dividends as an additionally helpful measure in determining the future potential of any company. GRS may pay a dividend at this time; however, there is an insufficient amount of history to incorporate it into our analysis. Therefore, we are not utilizing the dividends or lack thereof in our study. As GRS more consistent dividend history is made available, we will begin to factor this into the Ockham approach.

Peer Comparison

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Gammon Gold, Inc. Industry Grouping

(3/17/2010)
Company Ticker Market Cap (Ml) Latest
Price
Price/Cash Earnings Price/Sales 5-Yr. Rev.
Growth Rate
5-Yr.
Avg. ROE.
Current 10-Yr. Range* Current 10-Yr. Range*
Peer Company Averages (not including GRS) 81.49 4.38 » 193.24 19.34 0.54 » 32.65 37.53% 10.22%
*10 year range does not include current year values
Penn Virginia Resource Partners LP PVR $1.3 Billion $24.21 9.17 2.66 » 46.07 1.89 0.49 » 33.08 54.54% 16.94%
Schnitzer Steel Industries, Inc. SCHN $1.1 Billion $51.26 24.95 2.51 » 62.12 0.77 0.28 » 1.88 22.52% 17.47%
Gammon Gold, Inc. GRS $1.1 Billion $9.00 57.44 3.52 » 78.94 5.89 1.17 » 30.74 n/a 1.53%
Golden Star Resources Ltd. GSS $939.5 Million $3.65 7.35 1.80 » 408.00 2.40 0.37 » 18.01 45.86% 3.36%
Jaguar Mining Inc. JAG $928.7 Million $11.72 359.33 13.21 » 425.33 89.83 1.27 » 106.33 n/a -0.15%
Northgate Minerals Corp. NXG $914.9 Million $3.15 6.63 1.74 » 24.67 1.83 0.31 » 3.96 27.20% 13.48%
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3:55P, Nov. 06,2009 GRS $9.79 Gammon Gold, Inc.
Closing Bell

A First: RazorWire Slices News on GRS from Closing Bell

Popped up so heavy. >> I was about to say that. >> no question about it. It is kind of a crowded trade, butt the way to play that, then, is to buy the upside calls and things like barrett gold, GAMMON GOLD, slv, silver, it hasn't been mentioned a lot but it's tracking gold tick for tick. And you don't put a ton of your capital at risk, what we're really saying in buying the calls, I think gold is going to move higher very quickly. But there's a small possibility >> even higher than here? >> yes. >> how high's it going to go?

“… it's tracking gold tick for tick. And you don't put a ton of your capital at risk, what we're really saying in buying the calls, I think gold is going to move higher very quickly. But there's a small possibility >> even higher than here? >> yes. >> how high's it going to go? …”

View All Gammon Gold, Inc. Stock News

Key Fundamentals

GRS - Gammon Gold, Incorporated Fundamentals
Price (3/18 1:20PM) $8.95
Volume (3/18 1:20PM) 521,768
Last Close Price $9.00
10 Day Average Volume 1.2 Million
13 Week Price Range $8.40 - $12.50
52 Week Price Range $5.81 - $12.63
LTM Revenue $186.8 Million
 
Shares Outstanding (12/2008) 120.0 Million
Market Capitalization $1.1 Billion
Shares Held By Institutions 89.3 Million
Institutional Holders 147
% Shares Held By Institutions 71.80%
Earnings Per Share (EPS) $0.25
P/E Ratio 112.50
Book Value Per Share $5.44
 
Gross Margin 33.10%
Annual Dividend 0.00
Dividend Yield 0.00%
Beta 1.33
Fiscal Year Ends December

About Gammon Gold, Inc.

Gammon Gold, Incorporated is considered to operate in the Basic Materials sector. They specifically operate in the Gold business segment contained within the Metals & Mining industry.

A mining company which is also engaged in the exploration for and development of gold and silver deposits in Mexico.