Silvercorp Metals Inc (TSX:SVM, AMEX:SVM) earned a repeat ‘Buy’ rating from Canaccord Genuity (TSX:CF, LSE:CF) analysts following the release of its year-end production results.
The analysts also reiterated their price target of C$5.50 for the Canadian miner, which produces silver, gold, lead and zinc in China. Silvercorp’s shares are currently trading at about C$4.
“We have not made any changes to our estimates at this time,” the analysts wrote in a note to clients.
“Our C$5.50 per share target price remains based on an equal weighting of 4.5x NTM EBITDA and 0.7x NAV, measured as at January 1, 2024.”
The analysts wrote that during the March quarter, which is typically slower due to Lunar New Year celebrations, production and sales of all metals fell below their already tapered estimates.
Fourth quarter silver production of 1.11 million ounces was 5% below their estimate of 1.16 million ounces, lead production of 10.9 million pounds was 8% below their estimate of 11.9 million pounds, and zinc production of 3.6 million pounds was 17% below their estimate, the analysts said.
“The lower production was driven by lower grades across the board,” they wrote.
“Production fell short of full-year guidance for the second year in a row, although we had previously flagged this. No reason was provided for the miss.”
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