Hecla Mining's (NYSE:HL) Performance Is Even Better Than Its Earnings Suggest

By
Simply Wall St
Published
May 13, 2021
NYSE:HL

The subdued stock price reaction suggests that Hecla Mining Company's (NYSE:HL) strong earnings didn't offer any surprises. We think that investors have missed some encouraging factors underlying the profit figures.

See our latest analysis for Hecla Mining

earnings-and-revenue-history
NYSE:HL Earnings and Revenue History May 14th 2021

How Do Unusual Items Influence Profit?

Importantly, our data indicates that Hecla Mining's profit was reduced by US$15m, due to unusual items, over the last year. It's never great to see unusual items costing the company profits, but on the upside, things might improve sooner rather than later. We looked at thousands of listed companies and found that unusual items are very often one-off in nature. And that's hardly a surprise given these line items are considered unusual. If Hecla Mining doesn't see those unusual expenses repeat, then all else being equal we'd expect its profit to increase over the coming year.

That might leave you wondering what analysts are forecasting in terms of future profitability. Luckily, you can click here to see an interactive graph depicting future profitability, based on their estimates.

Our Take On Hecla Mining's Profit Performance

Unusual items (expenses) detracted from Hecla Mining's earnings over the last year, but we might see an improvement next year. Because of this, we think Hecla Mining's earnings potential is at least as good as it seems, and maybe even better! And it's also positive that the company showed enough improvement to book a profit this year, after losing money last year. Of course, we've only just scratched the surface when it comes to analysing its earnings; one could also consider margins, forecast growth, and return on investment, among other factors. In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. Case in point: We've spotted 2 warning signs for Hecla Mining you should be aware of.

Today we've zoomed in on a single data point to better understand the nature of Hecla Mining's profit. But there is always more to discover if you are capable of focussing your mind on minutiae. Some people consider a high return on equity to be a good sign of a quality business. While it might take a little research on your behalf, you may find this free collection of companies boasting high return on equity, or this list of stocks that insiders are buying to be useful.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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