Harmony Gold Mining Shares Are Rising

Harmony Gold Mining

Harmony Gold Mining Co (NYSE: HMY) shares are on momentum over the last two months; HMY stock jumped from $1.70 at the beginning of the previous month to $2.40 at present. HMY stock has the 52-week trading range of $1.56 – $2.78 per share and its market-cap stands just over $1 billion. It is gold mining company with operations in South Africa and Papua New Guinea (PNG).

HMY shares are getting support from improving market dynamics for gold prices. The robust revenue growth in the first half of fiscal 2017 and an upbeat outlook for the full year add to HMY share price uptrend.

Harmony Gold Mining

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The steady growth in gold prices has also been offering a room for margin and earnings expansion potential.

Gold stands around $1,350 per ounce as compared to $1,250 in the same period last year.

South African gold mining small cap posted total gold production of 560K oz in Q4, compared to 554K oz in the year-ago period. It’s all-in sustaining cost declined 2% year over year in the fourth quarter.

Improving production levels and enhanced operational efficiencies led the company to post earnings growth of $0.17 per share in Q4, up 49% from earnings of $0.13 per share in the prior year period.

Harmony Gold Mining expects production growth of 5% in the second half of 2017 from the first half, driven by healthy production from South African operations. The company’s future fundamentals started improving substantially after the government has approved mining at its newly acquired Moab Khotsong mine.

“The approval confirms government’s support of the transaction which will enhance the quality of our asset portfolio and increase our profit margins,” said Chief Executive Officer Peter Steenkamp.

The $300 million acquisition of Moab Khotsong mine is likely to boost Harmony Gold Mining operating cash flow by 60%, and the acquisition will also provide substantial cost savings and operational efficiencies.

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