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North American Palladium Ltd (USA) (PAL): An Early Earnings Look

Earnings season is now starting to wind down, with most companies already having reported their quarterly results. But there are still some companies left to report, and North American Palladium Ltd (USA) (NYSEAMEX:PAL) is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarter reports is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

North American Palladium is one of the only producers of platinum-group metals in North America, and with platinum and palladium having outperformed gold and silver recently, the company is getting some attention from investors. Let’s take an early look at what’s been happening with North American Palladium over the past quarter and what we’re likely to see in its quarterly report on Friday.

Stats on North American Palladium

Analyst EPS Estimate ($0.01)
Year-Ago EPS ($0.04)
Revenue Estimate $44 million
Change From Year-Ago Revenue (0.2%)
Earnings Beats in Past 4 Quarters 1

Source: Yahoo! Finance.

Stillwater Mining Company (NYSE:SWC)Will North American Palladium get shinier this quarter?
Analysts have followed the rising prices of platinum and palladium upward as they’ve boosted their earnings figures for North American Palladium in recent months, slashing the just-ended quarter’s loss in half and doubling their profit call for full-year 2013. The stock has reacted even more favorably, climbing nearly 30% since mid-November.

Platinum and palladium are important resources, both from their status as precious metals as well as due to their industrial uses. Palladium in particular is a major component of catalytic converters for automotive pollution control, and with Stillwater Mining Company (NYSE:SWC) being the only other platinum-group metal producer on the continent, North American Palladium can benefit greatly when demand rises.

Unfortunately, North American Palladium went through a spell of lower realized prices last year, due in part to weakness in auto sales in Europe. But with its Lac des Iles expansion expected to generate much higher yields than those gotten from mining near the surface, the miner is setting itself up to capitalize on recent price rises. Moreover, North American Palladium is looking to sell off its Vezza gold mine, making itself the only pure play on palladium after Stillwater bought an interest in a gold and copper mine in 2011.

In its quarterly report, look for North American Palladium to talk about investor interest in palladium and platinum. With total assets under management at platinum-group funds ETFS Physical Platinum Shares (NYSEARCA:PPLT) and ETFS Physical Palladium Shares (NYSEARCA:PALL) climbing by nearly a quarter billion dollars just since the beginning of 2013, North American Palladium could get support from metal-hugnry ETF investors.

The article North American Palladium: An Early Earnings Look originally appeared on and is written by Dan Caplinger.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool has no position in any of the stocks mentioned.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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