Coeur Mining (CDE)
Lowering Rating to Market Perform
Mark Reichman, Senior Research Analyst, Natural Resources, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Second quarter 2022 results. Coeur reported a second quarter adjusted net loss of $13.1 million or $(0.05) per share, compared to a net loss of $840 thousand or $(0.00) per share, during the prior year period, and our net income estimate of $4.0 million, or $0.01 per share. The variance to our estimates was due in part to higher costs applicable to sales. Adjusted EBITDA amounted to $43.3 million. Second quarter sales included 2.5 million ounces of silver and 84,786 ounces of gold. Coeur reaffirmed full year production guidance and increased cost guidance to reflect inflationary pressures. We have lowered our full year 2022 EBITDA and EPS estimates to $151.8 million and $(0.12), respectively, and our 2023 estimates to $181.3 million and $0.11. Our estimates reflect higher costs and lower commodity prices.
Rochester advances. The POA 11 Rochester expansion project is advancing with completion expected in mid-2023. Coeur has committed approximately $523 million of the $600 million estimated project capital cost and has incurred $350 million of the total estimated project cost through June 30. Coeur expects to spend between $217 million and $257 million in 2022 and $131 million and $171 million in 2023. In our view, the project’s net present value of $348.1 million estimated in the most recent technical report dated December 2021 is at risk of erosion due to higher costs and lower silver prices. Recall the first technical report published in 2020 predicted a capital cost of $396.8 million, now north of $600 million, and a net present value of $633.8 million….
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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.