Source: Streetwise Reports 05/22/2024
MAG Silver Corp. (AMEX:MAG) announced its intention to make a normal course issuer bid (NCIB) to possibly purchase for cancellation up to more than 8.6 million common shares in the company, or about 10% of the public float.
The silver producer said the Toronto Stock Exchange has accepted notice for the NCIB, in which a company can repurchase shares over a period of time when the stock is favorably priced.
In the United States, MAG said repurchases would be subject to a limit of more than 5.1 million common shares, or 5% of the public float as of May 8.
"MAG believes that when a disconnect exists between the share price and the intrinsic value of the business, an NCIB can increase shareholder value and per share growth" the company said in a release. "Further, the company believes that current market conditions provide opportunities for the company to acquire common shares at attractive prices."
Having the option to repurchase common shares opportunistically could be an effective use of its cash resources and in the best interests of the company and its shareholders, the company noted.
"It would both enhance liquidity for shareholders seeking to sell and provide an increase in the proportionate interests of shareholders wishing to maintain their positions" MAG said in the release.
The Catalyst: An Emerging Silver Producer
MAG is an emerging silver producer with its Tier 1 Juanicipio mine in Mexico and announced its first quarter 2024 financials last week.
The Juanicipio joint venture (JV), which the company owns 44% interest in, returned more than US$17.5 million in interest and loan principal repayments to MAG during the first quarter of 2024, the company said.
"We believe cash distributions are likely to increase in the quarters ahead, allowing MAG to consider paying a dividend by year-end 2024" continued Reagor, who reiterated his Buy rating on the stock and increased the price ...