AngloGold Ashanti

Anglogold Ashanti PLC is assigned a 2-star quantitative star rating, indicating our belief that this share class is a somewhat unattractive choice, and investors should look elsewhere for more fruitful opportunities. The stock currently trades at a 37% premium over our quantitative fair value estimate of $68.61 per share; however, this estimate should be taken with a pinch of salt due to its very high uncertainty rating.

The firm's valuation metrics weaken our estimated fair value. A company's valuation metrics provide insights into the market's expectations for its future growth and profitability. Reflecting the firm's valuation is its book value yield of 17.9%, which ranks in the bottom 20% compared with peers globally. The market value of this company's shares looks expensive relative to the book (accounting) value of equity, which contributes to our view that shares are expensive.

Conversely, the firm's solid growth is reassuring. Consistent revenue and earnings growth indicates a company's potential for increased market share and profitability. The firm's cash flow per share growth, for example, ranks in the top 45% compared with peers globally. This indicates a rapid rate of growth in cash flow available for reinvestment or return to shareholders, which, despite our unfavorable price/fair value ratio, is a positive attribute.

In addition to the aforementioned drivers, our model considers momentum as part of its comprehensive analysis. This share class has outperformed the broader universe over the past year. This outperformance may signify a bull trap, in light of other detractors from our model.

The company's narrow economic moat rating suggests it should be able to maintain robust profitability for a decade or longer before competition erodes its advantage. In addition, the company's moderate financial health score is decent and doesn't seriously concern us with regard to financial distress.