Pan American Silver Corp. (PAAS)

[SsMurry]

PAAS - Negative Impact

Daniel Earle released new analysis stating Pan American reported adjusted EPS of -$0.09 below both consensus and his estimate of $0.02, with the difference resulting from fewer sales and lower realized prices.

Production of 6.2 Moz was also below Daniel Earle's estimate of 6.5 Moz, due to less production at Alamos Dorado, Manantial Espejo and San Vicente, while net cash costs of $12.29/oz were largely in line with his forecast of $12.12/oz

Full year production guidance was maintained at 25.75–26.75 Moz at net cash costs of $11.70-$12.70/oz and Daniel Earle continues to forecast the company beating its cost guidance

However, at current market prices, the company's balance sheet may begin to be eroded quickly and that its growth prospects may be muted, in his view

The company’s balance sheet remains strong with $377mm in cash and short-term investments, $607mm in working capital, and only $57mm of total debt

Daniel Earle's 12- month target price remains unchanged at $12.00 and he maintains his HOLD recommendation.