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Why Eldorado Gold Stock Popped 10%

Rich Smith, The Motley Fool
Updated

What happened

Shares of gold miner Eldorado Gold (NYSE: EGO) are trading up 10% as of 3 p.m. EDT, which is a nice change from what we saw for most of last year. The question is, why is the stock going up? And the answer appears to be, nobody knows.

So what

After checking all my usual sources for explanations of inexplicable stock price movements -- everyone from TheFly.com to StreetInsider.com -- there appears to be no company-specific news moving Eldorado Gold's stock price today. The movement up can't have much to do with the price of gold itself, either, as gold is trading down today -- nearly $5 an ounce, at $1,254.45.

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So where does that leave us?

Gold nugget on a black floor, with multiple gold nuggets in the background.
Gold nugget on a black floor, with multiple gold nuggets in the background.

Investors are hoping to strike it rich when Eldorado Gold next reports. Image source: Getty Images.

Now what

Best guess: Today's movement is indicative of investors placing bets that when Eldorado Gold next reports earnings, the news will be good.

This morning, Eldorado published a press release confirming that it will be announcing "Q2 2018 financial and operational results" after the close of trading on Thursday, July 26. Analysts polled by S&P Global Market Intelligence are looking for Eldorado to report a $0.01-per-share loss (or no loss at all, pro forma) on revenue of $119.2 million.

Investors today, rightly or wrongly, appear to think Eldorado can beat those numbers -- and are placing their bets early that it will do so.

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Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.