BMO Reduces Endeavor Silver Target Price to $5.25


Endeavor Silver Corp. (TSX: EDR) announced its first quarter financial results last week. The company reported revenue of $57.7 million this quarter, up 67% year-over-year. Although the company’s net profit was flat year-over-year as inflation ate away at gross profits. The company saw its net profit for the quarter come in at $11.7 million.

CEO Dan Dickson commented on the results saying, “Our first quarter performance was strong, putting us on track to meet our 2022 production targets.”

Endeavor said its mine’s operating profit rose 258% year-over-year to $20.3 million this quarter, while its mine’s operating cash flow before tax was up 101% year over year to $26.7 million.

On production results, the company produced 1,314,955 ounces of silver and 8,695 ounces of gold, a 25% increase in silver production while their gold production fell 22% from one year to the next. This brings the total silver equivalent ounces produced by the company to 2,010,555, a year-over-year increase of 4%. Additionally, the business processed 206,147 tonnes, stable year-on-year.

Endeavor says the cash cost to produce an ounce of silver was $10.21, up 30% year over year, while the all-in sustaining costs per ounce of silver were $15. $.13 this quarter. The company sold 1,717,768 ounces of silver at a realized price of $24.38, down about 10% from a year ago. They also sold 8,381 ounces of gold at a realized price of $1,970, up 16% year-over-year.

Endeavor Silver currently has 7 analysts covering the stock with a 12-month average price target of C$7.12, which represents a 65% upside from the current stock price. Of the 7 analysts, 2 have buy ratings and the other 5 have hold ratings. The high of the street sits at C$11.04, up 155%.

In BMO Capital Markets’ earnings note, they reiterate their market performance rating and lower their 12-month price target from C$6.00 to C$5.25, saying the change comes primarily from rolling estimates.

As for the results, BMO says that the adjusted EPS of $0.07 reported by Endeavor Silver is higher than their estimate of $0.04. While the other highlight that BMO talks about is the company’s operating cash flow, which is in line with its estimate of $21.7 million.

Although BMO notes Endeavor’s revenue was $57.5 million, which includes a good portion of inventory on hand, they say additional metal sales were previously telegraphed.

Below, you can see BMO’s updated estimates on Endeavor Silver.

Information for this briefing was found via Sedar and Refinitiv. The author has no security or affiliation related to the organizations discussed. Not a buy or sell recommendation. Always do additional research and consult a professional before purchasing a title. The author holds no license.

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