Why Shares of Compania de Minas Buenaventura SAA Dropped Today

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 gold miner Compania de Minas Buenaventura SAA (ADR) (NYSE: BVN  ) fell as much as 11.5% today after releasing earnings.

So what: First quarter revenue fell 20% from a year ago to $282 million and net income swung from a $102.7 million profit to a $16.1 million loss, or $0.06 per share. Analysts were expecting earnings of $0.25 per share on revenue of $327.8 million.  

Now what: Everything is working against Buenaventura from production to precious metal prices. I don't see a reason to think prices will rise in the next year so even an increase in production from the Brocal expansion doesn't give me much incentive to buy. This is a stock I'll stay out of and think the $3.0 billion price tag is still high for the trends investors are facing in the precious metals market.

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