RE:Silver up 50 cents, FSM great production reportfrom Globe and Mail
Fortuna Silver Inc. (FVI-T) to “buy” from “hold”
“FVI was the worst performing stock among the precious metal producers in 2021; the shares declined by 53 per cent versus the peer group average decline of 19 per cent,” he said. “Two seminal events were the primary drivers behind the underperformance: A head-scratching foray into West Africa via the acquisition of ROXG at a large premium (that was subsequently arbitraged out ahead of the deal closing) ... FVI has since lost its “silver premium multiple” and the denial of the application to extend the environmental permits at San Jose, and the knock-on implications to the company’s liquidity. This has since been resolved.
“In addition, the company struggled with its operations for most of the year.”
His target for Fortuna shares rose to $6 from $5.50. The average target on the Street is $6.21.
“We expect a brighter outlook for FVI in 2022, especially given how low the bar was set in 2021. We look forward to Lindero finally hitting its stride as the asset learns to work through the COVID restrictions, and a full year of production from Yaramoko. Construction at Seguela should progress substantially through the year, providing the company with line of sight to its next leg of growth in 2023.”
PeterThomas wrote: shares up 2 cents.