Pan American Silver (PAAS) has received a new Hold rating, initiated by BMO Capital analyst, Matt Murphy.
Matt Murphy has given his Hold rating due to a combination of factors that reflect both the strengths and limitations of Pan American Silver. The company is recognized for its well-managed operations in silver and gold, with numerous opportunities for value creation through optimization and strategic transactions. A significant potential catalyst exists if the Escobal mine returns to production, which could notably increase silver output. However, despite these positive aspects, the current valuation framework suggests limited upside potential, leading to a Hold rating.
PAAS’s core gold assets are projected to produce substantial gold quantities, and its silver production remains strong, with the possibility of doubling if Escobal reopens. The company has been successful in asset disposals while retaining beneficial royalties, and there are ongoing efforts to optimize operations, such as at Jacobina. Despite being well-positioned to benefit from strong precious metals prices, the stock’s current trading metrics, including its P/NAV and P/CF ratios, indicate that the shares are fairly valued, justifying the Hold recommendation.
Murphy covers the Basic Materials sector, focusing on stocks such as Agnico Eagle, Barrick Gold, and Franco-Nevada. According to TipRanks, Murphy has an average return of 18.3% and a 69.64% success rate on recommended stocks.