Silver Standard Resources Inc. SSRM reported third-quarter 2020 adjusted earnings per share of 49 cents, which beat the Zacks Consensus Estimate of 28 cents. The bottom-line figure also marked an improvement of 69% over the 29 cents reported in the prior-year quarter. Increase in gold equivalents sold, higher average realized prices for gold and silver, and lower costs led to improved earnings in the quarter.
Including one-time items, earnings came in at 19 cents per share compared with 17 cents in the prior-year quarter.
Silver Standard’s total revenues improved 52.5% year over year to $225 million. Gold equivalent produced increased 2% year over year to 106,838 ounces in the reported quarter. Gold equivalents sold surged 21% to 115,312 ounces in the quarter on a year-over-year basis.
Average realized gold price surged 29% to $1,914 per ounce from the year-ago quarter. Average realized silver price was $26.69 per ounce in the quarter, reflecting an impressive year-over-year growth of 54%.
Silver Standard Resources Inc. Price, Consensus and EPS Surprise
Silver Standard Resources Inc. price-consensus-eps-surprise-chart | Silver Standard Resources Inc. Quote
Cash cost per gold equivalent ounce dipped 3% year over year to $735 in the third quarter. All-in sustaining costs (“AISC”) per gold equivalent ounce sold declined 9% to $1,034 in the reported quarter from $1,136 in the prior-year quarter.
Income from operations surged 60% year over year to $83.2 million during the third quarter. Gross margin was 37% in the third quarter compared with 35% in the last year’s quarter. Operating income was $52.7 million, up 32% from the year-ago quarter’s $39.9 million.
During the quarter, Silver Standard completed the transaction with Alacer. The combined entity boats a diversified portfolio of high quality, long-life operating assets across four jurisdictions.
As of Sep 30, 2020, cash and cash equivalents were $733.6 million, significantly up from the $503.6 million as of Dec 30, 2019. The company generated $44 million of cash flow from operations in the third quarter compared with $55 million in the prior-year quarter.
On Nov 12, 2020, the company’s board approved the initiation of a quarterly cash dividend of 5 cents per share beginning in first-quarter 2021.
For fiscal 2020, the company expects to produce 680,000 to 760,000 gold equivalent ounces from its four operating mines. Consolidated AISC are projected between $965 and $1,040 per gold equivalent ounce.
Shares of Silver Standard have gained 31.2% over the past year, compared with the industry’s rally of 19.0%.
Zacks Rank & Stocks to Consider
Silver Standard currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the basic materials space are Agnico Eagle Mines Limited AEM, Newmont Corporation NEM and Barrick Gold Corporation GOLD. While Agnico Eagle Mines and Newmont flaunt a Zacks Rank #1 (Strong Buy), Barrick Gold carries a Zacks Rank of 2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Agnico Eagle Mines Limited has an expected earnings growth rate of a whopping 103% for the current year. The company’s shares have rallied 26% over the past year.
Newmont has a projected earnings growth rate of 98% for 2020. The stock has gained 73% in a year’s time.
Barrick Gold has an estimated earnings growth rate of 99% for the ongoing year. Its shares have appreciated 56% in the past year.
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