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Agnico Q2 Record Cash Flow, Despite Gold Prices

The Deep Dive Aug 19, 2026

Summary

Agnico Eagle's record $1.34 billion quarterly free cash flow shows operating discipline that beat estimates despite weaker realized gold prices.

AISC (All-In Sustaining Cost — what it really costs to produce an ounce) landed at $1,459, hundreds below Newmont, Barrick, Kinross, and Equinox.

A July 1 pit wall failure at Canadian Malartic stranded about 370,000 ounces; mining resumes Q4 with full-year production guidance at the low end.

Capital spending guidance jumped 18% to fund Hope Bay, Odyssey Underground, and Detour as Agnico targets 20-30% production growth over the next decade.

Agnico trades at a 27% EBITDA and 40-65% free cash flow premium to senior peers, justified by a 16% AISC advantage and its growth pipeline.

Key points on Agnico Eagle Mines

  • The host frames Agnico's $1.34 billion in free cash flow as the best quarterly result in company history, while noting the headline number was lifted by the absence of a working-capital drag that hit Q1.
  • AISC of $1,459 per ounce beat Newmont by $162, the largest cost gap versus a senior peer in the quarter.
  • Production rose 4% quarter-over-quarter to 856,000 ounces, led by record mill throughput at Macassa, Detour, Meliodine and Catilla.
  • A July 1 pit-wall failure at Canadian Malartic's Barnet cut off 370,000 ounces and pushed full-year production guidance to the low end of the range.
  • CapEx guidance rose 18% at the midpoint to fund Hope Bay, Odyssey, Detour Underground, Upper Beaver, San Nicolas and Ikari.

Key points on Barrick Mining

  • The guest notes Barrick's attributable free cash flow fell to $141 million in the quarter, which pulled Agnico's FCF premium versus the senior peer set down to 40%.

Key points on Equinox Gold

  • The guest sets Equinox aside for valuation comparison because its merger with Orla closed July 31, leaving current multiples unclear.
  • Equinox posted the highest AISC among the senior peer set at $2,175 per ounce.

Key points on Kinross Gold

  • Kinross posted an AISC of $1,821 per ounce in the quarter and was used as one of three senior peers in Agnico's valuation comparison.

Key points on Newmont

  • The host frames the comparison as Newmont 'harvesting' while Agnico is 'planting', using Newmont's AISC of $1,621 per ounce against Agnico's $1,459 to make the cost gap concrete.
  • Newmont's all-in sustaining costs jumped nearly $600 an ounce in the quarter, and the guest says the company's press release had to 'torture' the word record to fit.
  • Newmont screens at roughly 10 times free cash flow versus Agnico at about 20x, and returns close to 5% of cash to shareholders.

Steve Hyland's takeaways

  • Top takeaway The host frames Agnico's valuation as the central question of the video: whether a company trading at roughly 20x free cash flow is a good stock when Newmont screens at 10x and returns about 5% in cash.
  • He credits Agnico's premium to three factors: a 16% lower AISC than the senior peer average, favorable geography in Canada, Australia, Finland and Mexico, and elevated CapEx funding Hope Bay.
  • He argues that if Agnico delivers its 20-30% production growth target over the next decade, today's premium will look cheap in retrospect.
  • He counters that if Agnico misses its growth targets, the premium means investors pay up for the privilege of watching.