Leading International Investment Research, Edison Investment Research

Edison Investment Research

Leading International Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

Equity Bottom-Up

Pan American Silver (PAAS) announced that it had completed an equity investment in Galleon Gold for C$11.25m, representing a 14.7% interest in the company. Earlier, PAAS provided convertible debt to Galleon for C$8.0m. Together with warrants, the equity investment and debt represent a 29.7% share in Galleon’s capital on a fully diluted basis. PAAS views this acquisition as a long-term investment. Given the current small size of the investment for PAAS, we make no changes to our estimates and maintain our valuation at US$44/share ahead of the FY26 guidance in January and the Skarn PEA due in Q226.

Pan American Silver (PAAS) announced that it had completed an equity investment in Galleon Gold for C$11.25m, representing a 14.7% interest in the company. Earlier, PAAS provided convertible debt to Galleon for C$8.0m. Together with warrants, the equity investment and debt represent a 29.7% share in Galleon’s capital on a fully diluted basis. PAAS views this acquisition as a long-term investment. Given the current small size of the investment for PAAS, we make no changes to our estimates and maintain our valuation at US$44/share ahead of the FY26 guidance in January and the Skarn PEA due in Q226.

Pan American Silver — Investment in Galleon Gold

Pan American Silver’s Q325 results saw the initial 27-day contribution from the recently acquired 44% interest in the Juanicipio project, which boosted its attributable silver production by c 10% and lowered the silver segment all-in sustaining cost (AISC) to an impressive US$15.4/oz. EBITDA adjusted for equity investment in the project was up 51% y-o-y and 11% q-o-q. We have upgraded our estimates on higher commodity prices and Juanicipio, raising our discounted cash flow (DCF)-based valuation of PAAS from US$38.0/share to US$43.5/share. The company is also evaluating a two-stage development approach for Skarn to maximise the value of the combined deposit, which, in our view, is not yet full priced in by the market.

Pan American Silver’s Q325 results saw the initial 27-day contribution from the recently acquired 44% interest in the Juanicipio project, which boosted its attributable silver production by c 10% and lowered the silver segment all-in sustaining cost (AISC) to an impressive US$15.4/oz. EBITDA adjusted for equity investment in the project was up 51% y-o-y and 11% q-o-q. We have upgraded our estimates on higher commodity prices and Juanicipio, raising our discounted cash flow (DCF)-based valuation of PAAS from US$38.0/share to US$43.5/share. The company is also evaluating a two-stage development approach for Skarn to maximise the value of the combined deposit, which, in our view, is not yet full priced in by the market.

Pan American Silver — First contribution from Juanicipio

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Index Rebalance

<ul>
<li>The MV Junior Gold Miners index represents the performance of small-cap gold and silver mining companies listed around the world. We like it because of impact.</li>
<li>This index is reviewed semiannually in March/September. During these reviews, names can be added or deleted from the index.</li>
<li>There will be no index changes for the December 2025 rebal event. However, we currently expect a one-way flow of US$186mm for December 2025 due to capping/re-capping.</li>
</ul>


The MV Junior Gold Miners index represents the performance of small-cap gold and silver mining companies listed around the world. We like it because of impact.
This index is reviewed semiannually in March/September. During these reviews, names can be added or deleted from the index.
There will be no index changes for the December 2025 rebal event. However, we currently expect a one-way flow of US$186mm for December 2025 due to capping/re-capping.


[Quiddity Index] MV Junior Gold Miners Index Dec25 Rebal: Capping Flow Expectations Limited

Pan American Silver (PAAS) has released its annual mineral reserves and resources statement, which once again demonstrates solid replacement rates across most categories on a comparable basis. Both silver and gold segments maintained essentially flat mineral reserves during the period. In addition, the silver segment achieved a visible increase in contained metal in the inferred category thanks to the strong exploration results at the flagship La Colorada project. The update excludes the recently acquired 44% interest in the Juanicipio mine, which will visibly boost the company’s silver reserves.

Pan American Silver (PAAS) has released its annual mineral reserves and resources statement, which once again demonstrates solid replacement rates across most categories on a comparable basis. Both silver and gold segments maintained essentially flat mineral reserves during the period. In addition, the silver segment achieved a visible increase in contained metal in the inferred category thanks to the strong exploration results at the flagship La Colorada project. The update excludes the recently acquired 44% interest in the Juanicipio mine, which will visibly boost the company’s silver reserves.

Pan American Silver — Reserves replacement track record maintained

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

<ul>
<li>There are 5 additions for the <a href="https://www.smartkarma.com/entities/vaneck-gold-miners-etf-usa" target="_blank" data-smartkarma-citation="entities:32924:1" rel="noopener">VanEck Gold Miners ETF/USA (GDX US)</a> in December. <a href="https://www.smartkarma.com/entities/zijin-gold-international" target="_blank" data-smartkarma-citation="entities:45448:1" rel="noopener">Zijin Gold (2259 HK)</a> is a surprise add (as are some of the others).</li>
<li>Estimated one-way turnover is 15.2% and that leads to a round-trip trade of US$8.8bn. There are many stocks with multiple days of ADV to trade from passive trackers.</li>
<li>The MarketVector Global Gold Miners Index has just passed its earlier highs, but a lot of the adds have broken out and are trading much higher than their prior highs.</li>
</ul>


There are 5 additions for the VanEck Gold Miners ETF/USA (GDX US) in December. Zijin Gold (2259 HK) is a surprise add (as are some of the others).
Estimated one-way turnover is 15.2% and that leads to a round-trip trade of US$8.8bn. There are many stocks with multiple days of ADV to trade from passive trackers.
The MarketVector Global Gold Miners Index has just passed its earlier highs, but a lot of the adds have broken out and are trading much higher than their prior highs.


Gold Miners ETF (GDX US) Dec Rebalance: 5 Adds and US$8.8bn Trade; Zijin Gold Added

United States

Pan American Silver Corporation is a primary silver producer.   The Company has seven operating mines in Mexico,  Peru, Argentina and Bolivia and several development projects in USA,  Mexico, Peru and Argentina.

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Pan American Silver (PAAS US)

Pan American Silver — Investment in Galleon Gold

Pan American Silver (PAAS) announced that it had completed an equity investment in Galleon Gold for C$11.25m, representing a 14.7% interest in the...

Edison Investment Research

Pan American Silver — First contribution from Juanicipio

Pan American Silver’s Q325 results saw the initial 27-day contribution from the recently acquired 44% interest in the Juanicipio project, which...

Edison Investment Research

[Quiddity Index] MV Junior Gold Miners Index Dec25 Rebal: Capping Flow Expectations Limited

The MV Junior Gold Miners Index gets a rebal but not a review in December so flows are limited to capping and recapping. So far not significant....

Travis Lundy

Pan American Silver — Reserves replacement track record maintained

Pan American Silver (PAAS) has released its annual mineral reserves and resources statement, which once again demonstrates solid replacement rates...

Edison Investment Research

Gold Miners ETF (GDX US) Dec Rebalance: 5 Adds and US$8.8bn Trade; Zijin Gold Added

The flows have changed following the non-inclusion of Zijin Gold in the index. With cornerstones locked up till end-March, Zijin Gold will not be...

Brian Freitas

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