2024-03-13 14:37:51 ET
Summary
- Pan American Silver saw a significant increase in gold production year-over-year following its Yamana acquisition, but margins disappointed in what was a tough year.
- Fortunately, 2024 will be a better year for the company with lower care and maintenance costs, a better H2 out of La Colorada, and lower capital expenditures.
- In this update, we'll dig into Pan American's Q4/FY2023 results, recent developments, and why the stock continues to be one of the lower risk ways to get silver exposure.
We're nearing the end of the Q4 earnings season for the precious metals sector, which was a mixed reporting season overall. Unfortunately, inflationary pressures and stagnant silver prices weighed on margins of many silver producers, and although gold miners fared better, a few of the larger producers came in shy of their guidance midpoints. The good news is that the H1 2024 outlook is far better, with gold prices higher year-over-year and several producers look to have guided toward more achievable results this year. Meanwhile, there's the possibility for higher dividends on balance in H2 if gold prices stay at current levels, whether this be performance dividends or special dividends. The latter makes the most sense, with a conservative and stable but growing base dividend that's able to be supplemented in stronger periods vs. a commodity price linked dividend that by definition will swing wildly....
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Pan American Silver: An Improved 2024 Margin Outlook