A-Mark Precious Metals Stock Summary
This week I take a look at one of the largest precious metals dealers that is trading below book value
A-Mark Precious Metals (AMRK) is one of those companies that just seems interesting so I decided to learn more about it. I have been to my local coin shop a time or two, and A-Mark provides some insight into that industry by being one of the largest wholesale and retail precious metals sellers. Another interesting tidbit is that A-Mark owns SilverTowne Mint, which is located in small town Indiana near where some of my family live, and I’ve been there once to buy some silver. The stock had a massive run up in price from the COVID lows to early 2022. AMRK then chopped around the same range until late 2024, where it has since slid nearly 50%. The stock seems potentially cheap, trading below book value, so I figured I should dig into it a bit.
A‑Mark Precious Metals is a fully integrated precious metals company founded in 1965 and publicly traded since 2014. The company has three main business segments: wholesale sales and ancillary services, direct-to-consumer retail, and secured lending. Through its wholesale arm, A‑Mark sources and distributes bullion, which includes gold, silver, platinum, palladium, and copper, all in various form factors. Additional services provided include logistics, secure storage, minting, hedging, and financing. Its direct-to-consumer operations consists of JM Bullion, Goldline, Silver Gold Bull, Pinehurst Coin Exchange, and Stack’s Bowers Galleries. These subsidiaries serve retail investors and collectors through online and traditional marketing channels. A third segment, Collateral Finance Corporation, issues collateralized loans backed by bullion, numismatic coins, and collectible cards.
Geographically, roughly half of A‑Mark’s FY 2024 revenue came from the U.S., with Europe contributing the next largest share (~44%), and the balance coming from the rest of North America, Asia Pacific, Australia, and Africa. A-Mark’s international presence has increased with recent acquisitions such as Hong Kong’s LPM Group (February 2024), Silver Gold Bull (June 2024), Spectrum Group International/Stack’s Bowers (February 2025), and Pinehurst Coin Exchange (February 2025).
A-Mark’s stock is doing pretty mediocre for a few reasons. First, while precious metals prices have risen, the more important factor is the amount of ounces sold. For example, the nine months ending in March 2025 saw an 8% decline in ounces of gold sold, and there was a 30% drop in silver ounces sold. Compounding this issue, apparently with the elevated prices, investors are selling their metals to A-Mark, but they are not buying new inventory, which has effected pricing. Next, The company does better in a volatile metal markets where bid-ask spreads widen, boosting its premium over spot prices. But the recent trend of high, yet stable, metal prices have led to premium compression and has reduced gross profit. In addition, elevated metal prices have inflated carrying costs and hedging-related financing expenses, contributing to a 25% rise in interest expense.
Financially, A‑Mark’s revenues grew steadily from $5.46B in 2020 to $9.70B in 2024, averaging $8.04B annually. At a glance, it is hard to tell how much AMRKs sales were from acquisitions, and how much from COVID era spending surplus that is fading away. On the flip side, you would think with recent geopolitical turmoil, more people would be buying precious metals. AMRKs operating income expanded from $27.3M in 2020, to $196.9M in 2023, before dipping to $72.1M in 2024. Operating margins averaged 1.46% over the last five years, with gross margins averaging 2.43%. I figured A-Mark had pretty thin margins, but 1.46% operating margins does not leave much room for error.
Return on assets (ROA) peaked at 16.5% in 2021 but fell to 4.09% in FY 2024, averaging 9.1% across five years. Prior to 2021, return on assets were consistently below 5%, which is not ideal. Average return on assets is above the company’s cost of capital, but the figure is skewed from the high returns generated during COVID. Another factor at play is A-Mark’s recent strategy has been to make acquisitions to diversify into higher margin retail sales instead of lower margin wholesale. In theory this should help drive the stock price to a reasonable valuation.
Turning to valuation, A-Mark’s FCF is all over the place, and seems to have been negative for a few years due to inventory builds during COVID. The company’s trailing PE 13.8, but also keep in mind this is based on much lower earnings than the prior few years. It looks like AMRK usually trades closer to 10x earnings, but during the COVID years it was trading below 5x. This was probably due to the market not rewarding the elevated earnings with a higher share price due to fears of earnings reverting back to the mean. While AMRK has had decent ROA the last few years, historically returns have been mediocre. Based on this it probably makes more sense to value the company on its assets. Currently, AMRK is trading at 0.87x book value, while historical average book value was 1.8x. Overall it looks like A-Mark could be undervalued, but I would need to study their historical financials more closely. I am not ready yet to pull the trigger on A-Mark, but it will be on the list of company’s to do further analysis on.
Stocks mentioned: AMRK 0.00%↑
Thanks for sharing. Interesting company.
anyway to get how much tangible book value is inventory + net cash ?