Why is the Evolution Mining (ASX:EVN) share price leaping 8% today?

Evolution Mining shares are on the move…

| More on:
Rising gold share price represented by a green arrow on piles of gold block.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

sdf

Key points

  • Evolution Mining shares accelerate 8.45% to $3.99
  • Geopolitical tensions are pushing the price of gold higher
  • The company is due to report its H1 FY22 results on Wednesday 16 February

The Evolution Mining Ltd (ASX: EVN) share price is shooting higher on Monday.

At the time of writing, the gold miner's shares are fetching for $3.98 a pop, up 8.45%. In comparison, the S&P/ASX 200 Index (ASX: XJO) is edging 0.31% higher to 7,239.9 points.

What's driving Evolution Mining shares higher?

With Russia massing its forces around Ukraine for a potential regime change, investors have fled to safe haven assets.

The price of gold has surged toward US$1,860 an ounce, an increase of almost 3% in the past week alone.

This is driving the Evolution Mining share price higher as elevated gold prices translate to bumper profits for the company.

At its most recent report released late last month, Evolution Mining recorded 318,766 ounces of gold produced for 2022. All-in sustaining costs (ASIC) came to A$1,381 (US$985) per ounce.

This means at the current gold price of US$1,860, Evolution is making around US$875 profit for every ounce sold. It's worth noting that this does not include the capital and discovery expenditure used on developing and bringing the assets online.

Furthermore, the company advised that it is on track to deliver its FY22 group guidance given the solid performance above. As such, management is forecasting 670,000 to 725,000 ounces at a sector leading AISC of A$1,135 to A$1,195 per ounce.

Evolution Mining is scheduled to release its half-year results for the 2022 financial year this Wednesday 16 February.

Evolution Mining share price summary

Evolution Mining is an Australian mining and exploration company that owns and operates five mines, mostly based in Australia. They include Cowal in New South Wales, Mungari in Western Australia, Mt Rawdon and Ernest Henry in Queensland, and Red Lake in Ontario, Canada.

Over the past 12 months, the Evolution Mining share price has lost more than 13% in value. A deterioration in commodity prices throughout the latter part of 2021 caused investors to run for the hills.

On valuation metrics, Evolution Mining commands a market capitalisation of around $7.29 billion, with approximately 1.83 billion shares outstanding.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Resources Shares

A man wearing a hard hat and high visibility vest looks out over a vast plain where heavy mining equipment can be seen in the background.
Resources Shares

Is the Fortescue share price a buy for passive income?

Let’s dig into the potential of this mining giant.

Read more »

Female miner standing next to a haul truck in a large mining operation.
Resources Shares

Major miners fall as iron ore prices continue to sink

Waning Chinese demand and oversupply concerns push iron ore prices lower.   

Read more »

A mining worker clenches his fists celebrating success at sunset in the mine.
Resources Shares

Would I buy Pilbara Minerals shares?

Are investors missing an opportunity with this lithium stock?

Read more »

Three miners looking at a tablet.
Resources Shares

Here's the earnings forecast out to 2029 for BHP shares

Let’s dig into the predictions.

Read more »

A smiling miner wearing a high vis vest and yellow hardhat does the thumbs up in front of an open pit copper mine.
Broker Notes

Why Macquarie expects this ASX All Ords copper stock to soar 48% in a year

Macquarie forecasts another big year of gains ahead for this ASX All Ords copper stock. But why?

Read more »

Female miner standing smiling in a mine.
Broker Notes

Why Macquarie predicts Pilbara Minerals shares could surge 71%

Macquarie forecasts a big rebound ahead for Pilbara Minerals shares. Let’s find out why.

Read more »

Two mining workers in orange high vis vests walk and talk at a mining site.
Resources Shares

ASX All Ords mining stock sinks on US silver acquisitions

Investors are bidding down the ASX All Ords miner on US acquisition news. But why?

Read more »

Image from either construction, mining or the oil industry of a friendly worker.
Resources Shares

How these 2 tailwinds could boost the BHP share price into 2026

A leading expert forecasts that BHP shares are set to recover. But why?

Read more »