Operating Margin - Eldorado Gold Corp (TSX:ELD)

Watchlist Manager

Watchlist

Price: 47.69 CAD -1.24%

Market Cap: 9.6B CAD

39.4%

Current

22%

Average

5.4%

Industry

Operating Margin represents how efficiently a company is able to generate profit through its core operations.

Higher ratios are generally better, illustrating the company is efficient in its operations and is good at turning sales into profits.

Operating Margin

39.4%

Operating Profit

661.6m

Revenue

1.7B

Operating Margin Across Competitors

Country		Company	Market Cap	Operating Margin
CA		Eldorado Gold Corp TSX:ELD	9.6B CAD	39%
RU	P	Polyus PJSC LSE:PLZL	70.4T USD	51%
ZA	G	Gold Fields Ltd JSE:GFI	677.4B Zac	53%
ZA	H	Harmony Gold Mining Company Ltd JSE:HAR	221.3B Zac	28%
CN		Zijin Mining Group Co Ltd SSE:601899	842.5B CNY	19%
US		Newmont Corporation NYSE:NEM	107.1B USD	43%
CA		Agnico Eagle Mines Ltd TSX:AEM	116.3B CAD	49%
AU	G	Greatland Gold PLC ASX:GGP	124.8B AUD	44%
CA		Barrick Mining Corp F:ABR0	62.2B EUR	45%
CA		Barrick Gold Corp TSX:ABX	100B CAD	45%
CA		Wheaton Precious Metals Corp TSX:WPM	73.4B CAD	58%

Eldorado Gold Corp
Glance View

Economic Moat

Narrow

Market Cap

9.6B CAD

Industry

Metals & Mining

Eldorado Gold Corporation, a stalwart in the mid-tier gold and based metals mining segment, has etched its presence across several critical resource-rich landscapes. With its roots tracing back to 1992, the company has gradually transformed into a mining force with a strategic focus on developing high-quality assets in politically dependable jurisdictions. Eldorado operates predominantly in Greece, Turkey, and Canada, leveraging its geographical diversity to mitigate regional risks. Its portfolio showcases a mix of operational mines and development projects, each reflecting an intricate blend of advanced technology and sustainable mining practices aimed at optimizing efficiency and environmental stewardship. The company's cornerstone assets, such as the Kişladağ mine in Turkey and the Lamaque mine in Canada, form the backbone of its operational strategy, contributing robustly to its gold production volumes. Profit generation for Eldorado Gold is intrinsically linked to its ability to extract and process ore efficiently, leveraging innovative techniques to ensure cost-effective production and superior yield. The company makes money through the sale of gold doré bars and concentrates, while also capitalizing on by-products such as silver and other base metals, which are mined alongside gold. With a keen eye on global market trends, Eldorado focuses on maintaining a strong balance sheet, managing production costs, and strategically developing new projects that promise future growth potential. Its commitment to operational excellence, prudent capital management, and community engagement positions it well within the volatile, ever-fluctuating cycles of the global gold market. By fostering strategic partnerships and investing in community initiatives, Eldorado Gold ensures not just profitability but also a sustainable and socially responsible approach to mining.

View ELD Analysis

ELD Intrinsic Value

What is Intrinsic Value?

Economic Moat is a concept popularized by Warren Buffett to describe a company's durable competitive advantage. It represents the 'moat' that protects a company from competitors and helps it sustain profitability over the long term. Our analysis of the past 10 years showed that companies with a wide economic moat significantly outperformed the market, delivering +645% returns compared to +189% for the S&P 500.

Our research into Economic Moat performance spans the past 10 years and focuses on companies with a wide economic moat. For this analysis, we calculated the average stock price returns of these companies, comparing them to the performance of the S&P 500 index over the same period.

The results were compelling: wide moat stocks achieved a remarkable +645% average return, compared to +188% for the broader market. This difference highlights the long-term benefits of investing in businesses that can maintain their market position and pricing power over time.

Note: This research does not account for survivorship bias. Past performance is not indicative of future results.

Determining whether a company has an economic moat requires both a deep dive into financial metrics and a qualitative assessment of its competitive position. Our analysts conduct a rigorous evaluation that focuses on identifying structural advantages that enable a company to sustain profitability and defend its market share over the long term.

The process begins with an analysis of a company’s historical financial performance. We assess how consistently the company has generated returns above its cost of capital and whether those returns have been stable or improving. However, financial performance alone doesn’t reveal the full picture. To understand the sources of these advantages, we evaluate five key drivers of economic moats:

Network Effect: We analyze whether the value of a company’s product or service grows as its user base expands. Platforms like payment systems or marketplaces benefit from this self-reinforcing.

Switching Costs: We assess whether customers face significant costs or disruptions when switching to a competitor’s product or service. High switching costs create customer stickiness and provide pricing power.

Intangible Assets: Strong brands, patents, and regulatory licenses can protect a company’s market position by creating barriers for competitors or enabling premium pricing. For example, a well-recognized consumer brand may command higher customer loyalty and margins.

Efficient scale: Occurs when a market is optimally served by one or a few players, making it unprofitable for new entrants to compete. This typically happens in industries with high fixed costs or geographic constraints, such as utilities or pipelines.

Cost Advantage: Companies with structural cost advantages can produce goods or services at a lower cost than their competitors, enabling them to offer competitive pricing or maintain higher margins. These advantages often arise from economies of scale, superior supply chain management, or proprietary technology. Firms like Walmart leverage their massive scale to negotiate better terms with suppliers, allowing them to undercut competitors on price.

By examining these factors in combination with a company’s financial performance and market positioning, we classify each company into one of three categories:

This rigorous evaluation ensures that our moat ratings are both comprehensive and reliable, giving investors the tools they need to make well-informed, long-term decisions.

The AI Assistant may sometimes provide inaccurate information.

Make your own investment decisions or consult a licensed financial advisor.

US	Johnson & Johnson NYSE:JNJ	Pharmaceuticals
US	Berkshire Hathaway Inc NYSE:BRK.A	Financial Services
US	Bank of America Corp NYSE:BAC	Banking
US	Mastercard Inc NYSE:MA	Technology
US	UnitedHealth Group Inc NYSE:UNH	Health Care
US	Exxon Mobil Corp NYSE:XOM	Energy
US	Pfizer Inc NYSE:PFE	Pharmaceuticals
US	Palantir Technologies Inc NYSE:PLTR	Technology
US	Nike Inc NYSE:NKE	Textiles, Apparel & Luxury Goods
US	Visa Inc NYSE:V	Technology
CN	Alibaba Group Holding Ltd NYSE:BABA	Retail
US	JPMorgan Chase & Co NYSE:JPM	Banking
US	Coca-Cola Co NYSE:KO	Beverages
US	Walmart Inc NYSE:WMT	Retail
US	Verizon Communications Inc NYSE:VZ	Telecommunication
US	Chevron Corp NYSE:CVX	Energy

	Telus Corp TSX:T	17.63 CAD 0.17%
	Auxly Cannabis Group Inc TSX:XLY	0.155 CAD 3.33%

	Johnson & Johnson NYSE:JNJ	211.58 USD 0.75%
	Berkshire Hathaway Inc NYSE:BRK.A	748 886.97 USD 0.85%
	Bank of America Corp NYSE:BAC	55.14 USD 1.06%
	Mastercard Inc NYSE:MA	571.93 USD 1.52%
	UnitedHealth Group Inc NYSE:UNH	341.84 USD 1.52%
	Exxon Mobil Corp NYSE:XOM	118.82 USD -0.6%

	Franklin Covey Co NYSE:FC	16.63 USD -0.12%
	Mohawk Industries Inc NYSE:MHK	112.49 USD -0.15%
	Ardmore Shipping Corp NYSE:ASC	11.14 USD -1.68%
	ASGN Inc NYSE:ASGN	48.07 USD 0.94%
	Skyworks Solutions Inc NASDAQ:SWKS	66.97 USD -1.88%
	Weatherford International PLC NASDAQ:WFRD	80.34 USD -1.07%

	Johnson & Johnson NYSE:JNJ	211.58 USD 0.75%
	Bank of America Corp NYSE:BAC	55.14 USD 1.06%
	Mastercard Inc NYSE:MA	571.93 USD 1.52%
	Salesforce Inc NYSE:CRM	262.23 USD -0.05%
	Abbvie Inc NYSE:ABBV	223.32 USD -0.29%
	Home Depot Inc NYSE:HD	359.65 USD 0.61%

Eldorado Gold Corp
TSX:ELD