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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Agnico-Eagle Mines (NYSE: AEM ) fell 19% today after the company shut down one of its mines.
So what: The Goldex mine in Val d'Or, Quebec, had issues with water inflow and ground instability, causing the company to suspend the project indefinitely. The shutdown will result in a $260 million charge in the third quarter to write off the investment.
Now what: 17% of the company's output was expected to come from the mine, and this was one of Agnico-Eagle's lowest-cost operations so the news couldn't be much worse. Considering the impact on operations, this is a big blow, and I'm not sure we've hit bottom here. At the least we know the shine has worn off shares of Agnico-Eagle; I think buying here would be like throwing money into a wishing well.
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