Wednesday, November 10, 2021
Sierra Metals (SMTS)(SMT:CA)
Third Quarter Results May Be An Inflection Point
As of April 24, 2020, Noble Capital Markets research on Sierra Metals is published under ticker symbols (SMTS and SMT:CA). The price target is in USD and based on ticker symbol SMTS. Research reports dated prior to April 24, 2020 may not follow these guidelines and could account for a variance in the price target.
Sierra Metals Inc is a precious and base metals producer in Latin America. The company acquires, explores, extracts, and produces mineral concentrates consisting of silver, copper, lead, zinc and gold in Mexico and Peru. Its activity includes the operation of the Yauricocha Mine in Peru, and the Bolivar and Cusi mines in Mexico. Yauricocha is an underground polymetallic mine using the sublevel block caving and cut-and-fill mining methods. Bolivar is a copper-silver-zinc-gold underground mine using room-and-pillar mining method. The majority of the revenue is earned by selling of the mineral concentrates to its customers in Peru.
Mark Reichman, Senior Research Analyst of Natural Resources, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
SMTS reports third quarter financial results. Sierra Metals generated an adjusted loss of $(0.02) per share and EBITDA of $17.4 million, compared to our EPS and EBITDA estimates of $0.06 and $29.5 million, respectively. On an unadjusted basis, Sierra Metals reported a loss of $(0.03) per share. Performance at the Bolivar mine has been negatively impacted by delays in mine development, infill drilling, and high personnel turnover. We did not anticipate a loss from mining operations at Bolivar where all in sustaining costs per copper equivalent pound were impacted by higher operating costs per tonne, sustaining capital, general and administrative costs, and treatment and refining costs. Development of higher-grade ore bodies is underway and we expect continued improvement with a return to normalized operations and earnings power within a quarter or two.
Updating estimates. Management revised its full year EBITDA guidance to $105 million to $110 million from $130 million to $140 million due to a lower contribution from Bolivar which is now expected to generate EBITDA in the range of $22 million to $26 million. We have revised our 2021 EPS and EBITDA estimates to $0.13 and $105.7 million, respectively, from $0.25 and $127.6 million. We have also …
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*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.
