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’s (PAAS’s) Q122 financial results were supported by strong gold and silver sales, while production was affected by the latest COVID-19 outbreak. The company maintained its guidance for FY22 and expects production to be second-half weighted. Costs were generally under control, with an impressive cost performance in the silver segment. Although PAAS is seeing increased cost pressures, its full-year cost expectations remained unchanged. We have updated our estimates to reflect the results and lower commodity prices, reducing our valuation from US$31.0/share to US$29.5/share. Following the recent weakness, the shares look attractive at an FY22e EV/EBITDA of 7.5x.

Pan American Silver’s (PAAS’s) Q122 financial results were supported by strong gold and silver sales, while production was affected by the latest COVID-19 outbreak. The company maintained its guidance for FY22 and expects production to be second-half weighted. Costs were generally under control, with an impressive cost performance in the silver segment. Although PAAS is seeing increased cost pressures, its full-year cost expectations remained unchanged. We have updated our estimates to reflect the results and lower commodity prices, reducing our valuation from US$31.0/share to US$29.5/share. Following the recent weakness, the shares look attractive at an FY22e EV/EBITDA of 7.5x.

Pan American Silver - Q122 results – good cost control

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>Gold has been consolidating its gains following the major breakout above 1850, and is now bullishly inflecting above 1970 short-term resistance.</li>
<li>We believe this sets the stage for a test of the 2089 all-time highs, and we expect a breakout which would complete a 10-year cup-and-handle pattern.</li>
<li>Gold and silver miners (GDX, GDXJ, SILJ) are also breaking out -- overweight/add exposure. Now is an opportune time to get in on these fresh breakouts.</li>
</ul>


Gold has been consolidating its gains following the major breakout above 1850, and is now bullishly inflecting above 1970 short-term resistance.
We believe this sets the stage for a test of the 2089 all-time highs, and we expect a breakout which would complete a 10-year cup-and-handle pattern.
Gold and silver miners (GDX, GDXJ, SILJ) are also breaking out -- overweight/add exposure. Now is an opportune time to get in on these fresh breakouts.


Miners Breaking Out, Buy Gold & Silver Miners NEM, GOLD, FNV, AEM, AUY, SSRM, BTG, WPM, PAAS, Others

Pan American Silver (PAAS) is one of the world largest primary silver producers, with key operations in the Americas. While the well-timed acquisition of Tahoe Resources in 2019 boosted exposure to gold, given the quality and the calibre of its key silver assets, PAAS remains predominantly a silver play. Although the COVID-19 pandemic and current geopolitical tensions have supported investment demand and driven commodity prices, in the longer term, normalising economic conditions and monetary policy signal a gradual shift to physical demand. With ongoing expansion in renewables, which could intensify due to energy security concerns, we expect solar photovoltaics (PV) and general e-mobility to become the main areas of growth for silver.

Pan American Silver (PAAS) is one of the world largest primary silver producers, with key operations in the Americas. While the well-timed acquisition of Tahoe Resources in 2019 boosted exposure to gold, given the quality and the calibre of its key silver assets, PAAS remains predominantly a silver play. Although the COVID-19 pandemic and current geopolitical tensions have supported investment demand and driven commodity prices, in the longer term, normalising economic conditions and monetary policy signal a gradual shift to physical demand. With ongoing expansion in renewables, which could intensify due to energy security concerns, we expect solar photovoltaics (PV) and general e-mobility to become the main areas of growth for silver.

Pan American Silver - Lean, mean silver machine

<ul>
<li>We continue to see some encouraging signs that suggest that the lows may have been established for this correction.</li>
<li>We still believe a bottoming process would likely take weeks or potentially months and could come with more tests of the lows -- or even an undercut.</li>
<li>With that said, we continue to see attractive and actionable setups, primarily within cyclical value (Energy, Materials, Manufacturing, Transportation, and Financials).</li>
</ul>


We continue to see some encouraging signs that suggest that the lows may have been established for this correction.
We still believe a bottoming process would likely take weeks or potentially months and could come with more tests of the lows -- or even an undercut.
With that said, we continue to see attractive and actionable setups, primarily within cyclical value (Energy, Materials, Manufacturing, Transportation, and Financials).


Encouraging Signs, But Concerns Still Outweigh; Buying Materials, Energy, Industrials, Health Care

Jitters over today’s Georgia Senate runoff elections led to mild weakness on the first trading day of the year. As we explain below, this appears to be just a blip on the radar and our bullish outlook remains intact. We continue to view any weakness as a buying opportunity. In today’s report we highlight attractive Groups and stocks within Consumer Discretionary and Materials: Casinos &amp; Gaming, Large-Cap, Copper, Gold, Western Hemisphere, Large-Cap, and Silver, Platinum.

Jitters over today’s Georgia Senate runoff elections led to mild weakness on the first trading day of the year. As we explain below, this appears to be just a blip on the radar and our bullish outlook remains intact. We continue to view any weakness as a buying opportunity. In today’s report we highlight attractive Groups and stocks within Consumer Discretionary and Materials: Casinos &amp; Gaming, Large-Cap, Copper, Gold, Western Hemisphere, Large-Cap, and Silver, Platinum.

U.S. Equity Strategy: Bullish Outlook Intact

Canada

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 CN)

Pan American Silver - Q122 results – good cost control

Pan American Silver’s (PAAS’s) Q122 financial results were supported by strong gold and silver sales, while production was affected by the latest...

Edison Investment Research

Miners Breaking Out, Buy Gold & Silver Miners NEM, GOLD, FNV, AEM, AUY, SSRM, BTG, WPM, PAAS, Others

#Gold has been consolidating its gains following the major breakout above 1850, and is now bullishly inflecting above 1970 short-term resistance....

Vermilion Research

Pan American Silver - Lean, mean silver machine

Pan American Silver (PAAS) is one of the world largest primary silver producers, with key operations in the Americas. While the well-timed...

Edison Investment Research

Encouraging Signs, But Concerns Still Outweigh; Buying Materials, Energy, Industrials, Health Care

We continue to see some encouraging signs that suggest that the lows may have been established for this correction. Still, cyclical value remains...

Vermilion Research

U.S. Equity Strategy: Bullish Outlook Intact

mild weakness on the first trading day of the year appears to be just a blip on the radar and our bullish outlook remains intact. We continue to...

Vermilion Research

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