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A-Mark Precious Metals (AMRK)
NASDAQ:AMRK
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A-Mark Precious Metals
(NASDAQ:AMRK)
68Neutral
Positive Factors
Financial Stability and Growth
A-Mark Precious Metals has ample capital to fund operations and growth initiatives, supported by a tangible net worth of $318.7M and maintained dividend yielding 2.8%.
Strategic Acquisitions
Management expects the pending acquisition of Spectrum Group International to be accretive to earnings, due to higher margins in numismatics auctions and wine collections.
Valuation
Shares of A-Mark Precious Metals trade at a multiple below the peer average, suggesting potential value for investors.
Negative Factors
Challenging Business Environment
Adjusted EBITDA of $17.8M was below consensus and forecast, reflecting a challenging business environment.
Earnings Decline
GAAP EPS declined 51.2% y/y and 71.1% q/q, indicating less favorable markets for A-Mark with lower price volatility in precious metals resulting in smaller spreads and lower EPS.
Market Conditions
The current tight-spread environment is challenging for A-Mark Precious Metals, as it navigates uncharted waters with gold prices setting new highs.
A-Mark Precious Metals (AMRK) vs. S&P 500 (SPY)
Market Cap
$584.00M
Dividend Yield3.02%
Average Volume (3M)251.61K
Price to Earnings (P/E)12.3
Beta (1Y)0.31
Revenue Growth4.95%
EPS Growth-54.69%
CountryUS
Employees482
SectorFinancial
Sector Strength82
IndustryFinancial - Capital Markets
Share Statistics
EPS (TTM)2.06
Shares Outstanding23,019,184
10 Day Avg. Volume254,337
30 Day Avg. Volume251,613
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.06
Price to Cash Flow (P/CF)1.50
P/FCF Ratio1.40
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$43.50Price Target Upside71.46% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
A-Mark Precious Metals Business Overview & Revenue Model
Company DescriptionA-Mark Precious Metals, Inc., together with its subsidiaries, operates as a precious metals trading company. It operates in three segments: Wholesale Sales & Ancillary Services, Direct-to-Consumer, and Secured Lending. The Wholesale Sales & Ancillary Services segment sells gold, silver, platinum, and palladium in the form of bars, plates, powders, wafers, grains, ingots, and coins. This segment also offers various ancillary services, including financing, storage, consignment, logistics, and various customized financial programs; and designs and produces minted silver products. The Direct-to-Consumer segment provides access to an array of gold, silver, copper, platinum, and palladium products through its websites and marketplaces. It operates five company-owned websites targeting specific niches within the precious metals retail market. This segment also operates as a direct retailer of precious metals to the investor community and markets its precious metal products on television, radio, and the internet, as well as through customer service outreach. The Secured Lending segment originates and acquires commercial loans secured by bullion and numismatic coins; and serves coin and precious metal dealers, investors, and collectors. The company serves customers, including financial institutions, bullion retailers, industrial manufacturers and fabricators, sovereign mints, refiners, coin and metal dealers, investors, collectors, and e-commerce and other retail customers. It has operations in the United States, rest of North America, Europe, the Asia Pacific, Africa, and Australia. A-Mark Precious Metals, Inc. was founded in 1965 and is headquartered in El Segundo, California.
How the Company Makes MoneyA-Mark Precious Metals generates revenue through a diverse range of activities centered around the trading and distribution of precious metals. The company's primary revenue streams include the sale of precious metals to clients and the provision of related financial services such as leasing and financing. A-Mark also earns income through hedging operations and by acting as an intermediary in the precious metals market. Significant partnerships with mints, refineries, and financial institutions further enhance its ability to offer comprehensive services and maintain a competitive edge in the marketplace. Additionally, A-Mark's geographical reach and established network of clients contribute to its steady revenue generation.
A-Mark Precious Metals Financial Statement Overview
Summary
A-Mark Precious Metals showcases strong revenue growth and robust cash flow generation, with a solid balance sheet. However, profitability margins can improve, and rising debt levels need careful monitoring.Income Statement
A-Mark Precious Metals shows a strong revenue growth trajectory with a notable increase in Total Revenue from the previous periods. The Gross Profit Margin and Net Profit Margin have shown some fluctuations, with the most recent TTM figures indicating moderate profitability. While EBIT and EBITDA margins are reasonable, the company could improve its cost management to enhance profitability further.76
Positive
Balance Sheet
The company's balance sheet reflects a moderate Debt-to-Equity ratio, indicating a balanced approach to leverage. The Return on Equity is healthy, suggesting effective use of shareholder funds to generate profits. The Equity Ratio indicates a stable financial structure, but the rising Total Debt in recent periods poses a potential risk if not managed carefully.68
Positive
Cash Flow
A-Mark Precious Metals demonstrates strong free cash flow generation, with significant growth in Free Cash Flow over recent periods. The Operating Cash Flow to Net Income Ratio is robust, indicating efficient cash generation relative to net income. This solid cash flow performance provides a cushion for future investments and debt management.80
Positive
| Breakdown | |||||
| TTM | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 | Jun 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 10.61B | 9.70B | 9.32B | 8.16B | 7.61B | 5.46B | Gross Profit |
| 196.25M | 173.25M | 294.67M | 261.76M | 210.20M | 66.97M | EBIT |
| 100.55M | 83.45M | 209.39M | 188.51M | 212.79M | 56.68M | EBITDA |
| 82.72M | 133.71M | 209.67M | 185.15M | 223.45M | 59.64M | Net Income Common Stockholders |
| 51.49M | 68.55M | 156.36M | 132.54M | 159.64M | 30.51M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 15.02M | 48.64M | 39.32M | 37.78M | 101.41M | 52.33M | Total Assets |
| 293.44M | 1.83B | 1.55B | 1.44B | 1.19B | 758.03M | Total Debt |
| 106.00M | 775.11M | 666.14M | 315.05M | 283.54M | 231.32M | Net Debt |
| 90.98M | 726.47M | 626.82M | 277.26M | 182.13M | 178.99M | Total Liabilities |
| 240.49M | 1.17B | 945.18M | 952.19M | 827.64M | 653.14M | Stockholders Equity |
| 52.94M | 607.63M | 599.12M | 488.61M | 362.62M | 101.00M |
| Cash Flow | Free Cash Flow | ||||
| 128.88M | 45.16M | -40.11M | -92.44M | -54.77M | 46.95M | Operating Cash Flow |
| 140.82M | 60.93M | -30.32M | -89.17M | -52.65M | 47.94M | Investing Cash Flow |
| -42.76M | -63.60M | 6.84M | -60.56M | -130.39M | 48.77M | Financing Cash Flow |
| -91.14M | 11.98M | -12.27M | 86.11M | 232.13M | -52.70M |
A-Mark Precious Metals Technical Analysis
Negative
25.37
Price Trends
27.64
Negative
28.29
Negative
33.11
Negative
Market Momentum
-0.13
Positive
34.95
Neutral
21.17
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AMRK, the sentiment is Negative. The current price of 25.37 is below the 20-day moving average (MA) of 27.67, below the 50-day MA of 27.64, and below the 200-day MA of 33.11, indicating a bearish trend. The MACD of -0.13 indicates Positive momentum. The RSI at 34.95 is Neutral, neither overbought nor oversold. The STOCH value of 21.17 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AMRK.
A-Mark Precious Metals Risk Analysis
A-Mark Precious Metals disclosed 49 risk factors in its most recent earnings report. A-Mark Precious Metals reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
A-Mark Precious Metals Peers Comparison
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $8.82B | 15.04 | 25.19% | 0.74% | 20.35% | 20.44% | |
71 Outperform | $18.62B | 15.87 | 0.90% | 0.61% | 9.18% | ― | |
68 Neutral | $584.00M | 12.32 | 8.22% | 3.02% | 4.95% | -54.69% | |
66 Neutral | $54.42B | 16.90 | 11.13% | 2.08% | 58.27% | ― | |
63 Neutral | $14.20B | 10.11 | 9.01% | 4.34% | 16.34% | -11.27% | |
55 Neutral | $3.11B | ― | -15.89% | ― | -0.71% | 80.26% |
* Financial Sector Average
Performance Comparison
AMRK
A-Mark Precious Metals
25.37
-5.04
-16.57%
GOLD
Barrick Gold
19.44
2.95
17.89%
HMY
Harmony Gold Mining
14.77
6.77
84.63%
NEM
Newmont Mining
48.28
12.67
35.58%
SBSW
Sibanye Stillwater
4.58
-0.09
-1.93%
AU
Anglogold Ashanti PLC
37.12
15.58
72.33%
A-Mark Precious Metals Earnings Call Summary
Earnings Call Date: Feb 6, 2025 | % Change Since: -10.35% | Next Earnings Date: May 8, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted significant revenue growth and strategic expansion into new markets, but these positives were countered by declines in gross profit, EBITDA, and net income, alongside increased expenses and reduced silver sales.Highlights
Revenue Growth
Revenues for fiscal Q2 2025 increased 32% to $2.742 billion from $2.079 billion in Q2 of last year. Excluding an increase of $167.3 million of forward sales, revenues increased $496.2 million or 38%.
DTC Segment Expansion
The DTC segment contributed 21% of the consolidated revenue in fiscal Q2 2025, up from 18% in 2024. The number of new customers in the DTC segment increased 25% from Q2 of last year.
Strategic Acquisition
A-Mark entered into a definitive agreement to acquire Spectrum Group International, expanding its presence into the premium collectible market and adjacent higher-margin luxury markets.
Inventory Turn Ratio Improvement
The inventory turn ratio was 2.2 in Q2 fiscal 2025, a 16% increase from 1.9 in Q2 of last year.
Lowlights
Gross Profit Decline
Gross profit for fiscal Q2 2025 decreased 3% to $44.8 million or 1.63% of revenue, from $46 million or 2.22% of revenue in Q2 of last year.
Decreased EBITDA
EBITDA for Q2 fiscal 2025 totaled $16.2 million, a 35% decrease compared to $25.1 million in Q2 fiscal 2024.
Drop in Net Income
Net income attributable to the company for the second quarter of fiscal 2025 totaled $6.6 million or $0.27 per diluted share, compared to $13.8 million or $0.57 per diluted share in the same year-ago quarter.
Decline in Silver Sales
Sold 21.8 million ounces of silver in Q2 fiscal 2025, down 18% from Q2 of last year.
SG&A Expense Increase
SG&A expenses for fiscal Q2 2025 increased 15% to $25.8 million from $22.4 million in Q2 of last year.
Decrease in Equity Method Investments Earnings
Earnings from equity method investments in Q2 2025 decreased 410% to a loss of $2.4 million from earnings of $0.8 million in the same year-ago quarter.
Company Guidance
During A-Mark Precious Metals, Inc.'s fiscal second quarter 2025 earnings call, the company reported earnings of $0.27 per diluted share and $16.2 million in non-GAAP EBITDA. Revenue for the quarter increased 32% to $2.742 billion, driven by a 38% rise in gold sales and higher average selling prices for gold and silver, despite a decline in silver ounces sold. The DTC segment contributed 21% of the consolidated revenue, with JMB accounting for 11%. Gross profit decreased 3% to $44.8 million, primarily due to lower profits in the Wholesale Sales and Ancillary Services segment. SG&A expenses rose 15% to $25.8 million, influenced by increased consulting fees and advertising costs. The company also highlighted its strategic acquisition of Spectrum Group International, aiming to enhance its presence in the numismatic and luxury markets. Additionally, A-Mark amended its trading credit facility to $457 million and executed a $5.1 million stock repurchase.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.