mineweb.com / Dorothy Kosich / Friday , 10 Jan 2014
Dundee Capital Markets analysts counsel that most silver mining production results will either meet guidance or decline slightly.
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Dundee Capital Markets predicted silver equivalent production growth of greater than 10% this year from First Majestic, Fortuna Silver, Silver Wheaton and Silver Crest.
However, in a sector outlook document published Thursday, Dundee Capital Markets analysts Chris Lichtenheldt and Scott Morrison warned that for the rest of their coverage universe 2014 production is expected “to be roughly flat or decline slightly.”
“Generally we are expecting most [silver] companies to report 2013 production results in-line with guidance; however, we forecast Coeur Mining could miss its 2013 silver production guidance,” they advised.
“During the first 9M of 2013, the company’s Rochester mine produced 2.1Mozs of silver, leaving 1.6Mozs to produce in Q4 at the low-end of guidance at that mine,” the analysts observed. “We expect the company to miss guidance at Rochester and therefore we forecast full-year 2013 silver production of 17.7Moz versus the guided range of 18.0-19Moz.” Dundee rated Coeur Mining as “Sell” with a target of Cdn$9.
Dundee also predicted quarter-on-quarter production growth for Fortuna Silver due to completion of the expansion at the San Jose operation. Other key Q4 issues to watch include total ore processed, average silver grade, and average recovery, the analysts suggested. Dundee rated Fortuna as a “Buy” with a target price of C$5.25.