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Pan American Silver Corp. Message Board

  • you_know_me_al you_know_me_al Sep 17, 2013 1:05 PM Flag

    I remember . . .

    I remember when some guy whose name I forget on cnbc said paas was undervalued at 15. And later some other guy on cnbc said he's getting into paas, as it is a good value, and that was at 12.5. And this hedge rebuy catastrophic news is getting old and tired. Once the accumulation of shares starts, watch out. It'll be a slow start and accelerate all week. Watch!

    Sentiment: Strong Buy

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    • It would require serious help from silver price to see upward stock movement indicated in your message. All those remarks about “good value” with different share pricing are/were relative, i.e. it might be a good value at good silver price and when silver price is bad then…

      This hedge, also mentioned in your message, caused certain shift in assessment (mostly, this message board assessment) of this stock. It provided kind of wrong reasoning that all problems were related to the hedge and now, when hedge is not here anymore, everything is fine. It is not correct. Firstly, hedge was not the main reason of stock problems and, secondly, the main reasons (low silver price and high mining cost) are still around.

      Shortly speaking PAAS has no chance to outperform the sector as long as cost problem is not addressed. So far company seemingly hoped that silver price recovers miraculously making cost problem obsolete and it doesn’t work. It means that company should make serious operational steps to improve cost situation; that’s the best and, likely, the only way to improve share pricing.

      • 1 Reply to warmcamp
      • I agree that the hedge was largely irrelevant. It wasn't big enough to make a huge difference. It was only about 2 months production anyway. With or without that hedge, if silver prices rose, PAAS's receipts would rise. Now, if they had sold 2 year's production, that would have been different. As you said, PAAS is going to move with silver, not on its own.
        I also agree, the story right now is about keeping the mining cost under the sales price. PAAS has some low cost mines, so it's certainly possible. I wouldn't mind seeing them sell more of the higher cost mines, such as Peru or Bolivia. The one thing that could make those mines profitable again would be for zinc and lead to go back over $1.

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