Looking at the 5 year correlation between PAAS and SLV there is a 100%+ divergence (In SLV's favor). Yes, Pan American management has made some mistakes, but I have to believe they are smart enough to "buy low" and ratchet up a share buyback program! Look at the silver prices the last time PAAS was around the $10 level:
September 2003 $ 6.30
November 2008 $10.80
October 2013 $22.40
There is enough cash to bring that float down a little from above the 150 million share level. Issue a little debt or temporarily suspend the dividend to do it if you must. Unless there is a bombshell about to hit this stock that insiders know about then why wouldn't we buy back shares at decade lows?
Sentiment: Strong Buy
Thanks for your clarifications, Eye4value.
It is difficult to predict how things will go in future, esp. long-term. It would be good enough to have correct projections for next week :)
Regarding future projections for PM investment demand, one should not ignore government tendency to replace individual-based wealth, leaving enough room for gold/silver hoarding, with socialized benefits, discouraging this hoarding. Historical experience says that governments lose to people, eventually (!). However, it is based on past experience and present governments concentrate powers incomparable with older times.
MaryJane, you sound way too cerebral to be visiting this Yahoo stock chat. Couldn't be more in agreement.. have what I need longer term but keeping a powder horn dry in case oportunity strikes.
Communist Argentina will go the way of those smaller countries that try the great socialist expiriment and kill all capitalism within their borders. The result will be immense turnaround when they wake up.
Not sure whether this is a bear market for silver, but definitely is for PAAS. SLV seems to show good relative strength here and Market Edge rates SLV as Long, so I'm thinking at some point PAAS will track silver higher. Today's downside catalyst was Goldman Sachs saying that $1050 gold was a "no brainer" after the budget-debt stalemate is finished. My question is when does it get finished? To me, it's most likely that we get a series of short term debt celing extensions and a protracted period of uncertainty. Also, as crazy as the Tea Baggers are, it's very possible we do have a default.
Hi warmcamp, hope you're well.
To your first comment, yes you can argue that silver currently shows no sign of moving higher any time soon and as a money making investment that isn't a good thing. In my case I'm more worried about inflation making the buying power of what I have saved for my retirement go down. Think of the pain that your average retired person in Argentina must be in. As for timing of when silver will go higher I clearly don't know, but this time around we are in a totally different situation from 1981. The Fed then ended high inflation by pumping up interest rates. Right now they are doing the opposite and as government debt continues to increase that will limit the ability of the Fed to move rates higher even when they start to see inflation ( probably a couple of years off, IMHO)
As for your second point. yes, clearly silver follows the law of supply of demand. On the supply side, I don't see any shortage, but I also don't see supply rocketing higher. So let's assume that supply isn't a factor either way. That leaves demand. You have industrial demand, jewelry demand and investment demand. I guess one could argue that industrial demand will continue to go higher, but I don't think that will move the needle one way of the other. So it all boils down to investment demand and as you say just because more money is floating around it doesn't mean people will buy silver with it. Having said that, more money being printed does historically tend to float all asset boats. I think the real driver will be then people that have accumulated all this newly printed money realize that there's a lot more of it around now and they would like to protect their newly found wealth by buying assets that can't be printed. ( basically a fear trade)
This will not happen till we see signs of inflation, which is not on anyone's current radar screen.
Perhaps, “they” (aka market) want guys to learn few things and guys still refuse. Is it market’s fault? I guess no.
Look back; what happened with gold/silver stocks in 2008? What happened with the same stocks during last 2-3 years when any meaningful market turmoil appeared on horizon? They fell down and they did it stronger than the rest of the market. It is called bear market (for this sector). It is wrong to apply bull market thinking to bear market situations.
Gold and silver bullion have departed company with equity shares in precious metals and the small producres and stronger explorers should be the biggest earners in the months to come.
I've not been buying... yet... I'm still substantially ahead on position over-all.. but I've been in the stock for a long time. I'm thinking the trigger finger is beginning to itch.. significantly! I've never chased this stock and was even out of place slightly more than a dollar,, initially... but I feel confident that speculators have been hosed out of this one.
what a masterful job of painting the tape on low volume to psychologically crush and defeat any remaining share holders and to discourage any sane person from ever taking a new position in the company. i mean, really who the hell is left to sell stock in paas? from 45 to 10 in 2 1/2 years with cash per share and book value of approx 15. i coined the phrase from previous stock disasters and losing gambling sessions that one is being embalmed alive. they are literally sticking a needle in us and sucking the very lifeblood out of us while we watch the blood flow into the bottle. the bottom line is the master players will eventually need to turn this stock around and take it up without anyone being able to make a profit. get it. how do you do it? this is how.
I'm watching and waiting. This is getting to a very tempting price.
there will NOT be a default. to think that there will beis simply ignorant and foolish. Maybe down the road there could be a default, but for now they have access to an unlimited printing press. People should be buying silver, gold and good producers ( although producers shold bea minimal amount as risks are very high ...especially nationalization risks )
If buying when the market is wrong and the price looks bad is correct, then now is the time to buy PAAS.
Even the most negative analyst expect a 35% increase immediately for PAAS.
Sentiment: Strong Buy
We are at 5 year lows as the market hits new highs, currently trading as if silver was $10 an ounce!
Paas has some of the lowest cost of production and best management around!! We bounced off recent lows and in turn confirmed a double bottom....Keep selling me this %5 yielder
at these attractive levels!!