I Know First Review: Coeur Mining, Inc. (CDE)

I Know First Review

Coeur Mining, Inc. (CDE)

Coeur Mining, Inc. (CDE) owns, operates, explores for, and develops silver and gold properties. The company markets its silver and gold concentrates to third-party refiners and smelters in the United States, China, and Japan. The company holds interests in mines located in Mexico and the United States. It also owns mines in Bolivia, Australia, Mexico, and southern Argentina. It was founded in 1928 and is based in Chicago, Illinois.

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After suffering through a rough year in 2015, Coeur Mining, Inc. has made a strong recovery. Silver prices fell 12.4% in 2015 bringing Coeur down 51.5% as well. However, with the recent rally in gold and silver prices, CDE has experienced growth of more than 200% in the last 3 months alone.

With the dollar weakening, silver and gold have seen tremendous growth in prices. On April 29th, silver (SLV) was trading at its highest level since January 2015. While this change in commodity prices has a positive impact on share prices of companies like Barrick Gold (ABX), CDE has seen growth far beyond that of ABX.

Coeur has higher operating costs than Barrick does and the cost of pulling an ounce of silver from the ground relates closely to the price of selling that ounce. In 2015, Coeur was spending about $15.66 per ounce of silver that it was mining, and the price of silver at the beginning of this year was around $13.80 an ounce. Some quick math will show that this ratio is less than ideal. The recent surge in commodity prices has pushed the price of silver higher than the cost of mining it for Coeur, allowing for the company to make a profit and attracting investors.

Coeur Mining released their earnings report for the first quarter of 2016 at the end of April, showing improvement from the last quarter of last year. The company lowered its adjusted all-in sustaining costs to $13.73 per realized silver equivalent ounce while silver prices increased simultaneously. CDE reported total revenues of $147.82 million and net earnings of -$20.40 million. Gross margins were increased from -0.25% to 11.21% from the previous quarter showing tremendous improvement from the struggles that the company experienced at the end of 2015. Earnings were up 93.27% from the fourth quarter of 2015 as well.

On February 7th, 2016, the machine-learning algorithm gave CDE a strong bullish signal of 11.27 with a predictability of 0.45 for the 3-month time horizon. As you can see in the forecast below, CDE increased in accordance with the algorithm’s prediction to return an outstanding 209.80% to investors in that time period.

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