UPDATE: Analyst Actions: UBS Cuts Price Target on Pan American Silver to US$20; Shares up Nearly 1%

By Midnight Trader,  August 16, 2012, 09:43:57 AM EDT

UBS has cut its price target on Pan American Silver Corp. (PAA.TO, PAAS) to US$20 from $20.50, while reiterating its buy rating. The action follows the company reporting adjusted second quarter earnings per share of 11 cents earlier this week, well below consensus of 34 cents and UBS estimates of 29 cents.

"The three main reasons for the miss were: 1) 700k fewer ozs of silver sold vs. produced; 2) 5.8k fewer ozs of gold sold vs. produced; and, 3) provisional pricing adjustment of roughly -$0.06/shr. Silver production and cash costs, however, were relatively inline with 6.4Mozs produced at a cash cost of $11.85/oz vs. our estimate of 6.3Mozs produced at a cash cost of $11.25/oz," UBS said.

But the company maintained its production outlook and reported positive exploration results at its La Colorada and Waterloo projects. The board also raised the company's dividend payout.

The stock in Toronto is up 0.9% at $15.33, moving away from a 52-week low of $13.79.




The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.


This article appears in: Investing, Commodities

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