FVI:CC - Fortuna Silver Mines: Softer Silver Price Will Weigh On Q2 Margins
- Fortuna Silver released its Q1 results earlier this month, reporting quarterly production of ~66,800 ounces of gold and ~1.67 million ounces of silver.
- While gold production was up sharply and costs improved sequentially at Yaramoko, we saw meaningful degradation in margins for the company's silver business.
- This margin compression is likely to continue in Q2, and while Fortuna might beat its cost guidance mid-points, I would expect costs to increase sharply starting in H2 2023.
- At a current share price of $3.50, Fortuna has some upside to fair value, but I continue to see much more attractive bets elsewhere in the sector.
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Fortuna Silver Mines: Softer Silver Price Will Weigh On Q2 Margins