Shares of Alamos Gold (AGI) tumbled 7.64% in after-hours trading on Wednesday, as investors braced for the company's first-quarter earnings report and grappled with concerns about the stock's valuation.

The significant drop comes as Alamos Gold is scheduled to release its Q1 2025 financial results after the market close. Analysts are expecting earnings per share of $0.19 for the quarter. However, the sharp decline suggests that some investors may be anticipating disappointing results or guidance from the gold miner.

Adding to the downward pressure, a recent comparison with industry peer Barrick Gold (GOLD) has raised questions about Alamos Gold's valuation. Barrick Gold currently trades at a more attractive forward P/E ratio of 11.39 compared to Alamos Gold's 21.74, potentially indicating that Alamos is overvalued relative to its competitor. This valuation gap may be prompting some investors to reassess their positions in AGI.

Furthermore, NYSE order imbalance data showed 157,779 more shares on the sell side than the buy side near the close of regular trading, indicating heightened selling pressure. This imbalance likely contributed to the after-hours plunge as more investors moved to exit their positions in anticipation of potential negative news.