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MAG Silver's (MAG) Q2 Earnings Beat Estimates, Rise Y/Y

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MAG Silver (MAG - Free Report) reported adjusted earnings per share of 8 cents for second-quarter 2022, beating the Zacks Consensus Estimate of 6 cents. The bottom-line figure skyrocketed 167% from last-year quarter’s earnings per share of 3 cents.

Net income for the quarter surged 129% year over year to $7.6 million. MAG Silver’s principal asset is the Juanicipio Project located in Zacatecas, Mexico. MAG has 44% interest in Juanicipio, currently being developed with its operator Fresnillo Plc (FNLPF - Free Report) , which holds the remaining 56% stake. MAG recorded income from Juanicipio of $12 million compared with $4.8 million in the year-ago comparable quarter. This included MAG’s 44% share of net income from the sale of pre-production development and stope material as well as loan interest earned on mining assets brought into use. MAG reported an operating income of around $9 million in the second quarter of 2022, compared with $1.76 million in the second quarter of 2021.

At the end of the June quarter, MAG Silver had a cash balance of $44.6 million compared with $57 billion at the end of 2021 with no long-term debt. Net cash used in operations was $5 million in the second quarter compared with $0.9 million in the prior-year quarter.
 

MAG Silver Corporation Price, Consensus and EPS Surprise

MAG Silver Corporation Price, Consensus and EPS Surprise

MAG Silver Corporation price-consensus-eps-surprise-chart | MAG Silver Corporation Quote

In May, MAG completed the previously announced acquisition of Gatling Exploration Inc., a Canadian gold exploration company focused on advancing the Larder Project. It is located in the prolific Abitibi greenstone belt in Northern Ontario, Canada.  MAG initiated a drilling campaign on the Larder Project. In addition to a comprehensive data review, a drilling program is being considered to drill below and lateral to the already identified mineralization. MAG is also executing a multi-phase exploration program at the Deer Trail 100% earn-in project in Utah.

Construction of the Juanicipio plant was delivered by Fresnillo on schedule during the fourth quarter of 2021. However, the mill-commissioning timeline was extended until the tie-in approval to the national power grid is obtained from the federal power authorities, which is expected in the third quarter of 2022. An expanded exploration program is also in place, targeting multiple highly prospective targets at Juanicipio.

As reported by Fresnillo, on a 100% basis, 154,069 tons of mineralized material from both underground development and initial stopes Juanicipio were processed during the three months ended Jun 30, 2022, at an average head grade of 567 silver grams per ton.

Price Performance

Zacks Investment Research
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Shares of MAG Silver have declined 23.3% in the past year compared with the industry’s decrease of 30%.

Zacks Rank & Stocks to Consider

MAG Silver currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the basic materials space are ATI Inc. (ATI - Free Report) and Albemarle Corporation (ALB - Free Report) .

ATI, currently sporting a Zacks Rank #1 (Strong Buy), has a projected earnings growth rate of 1,069.2% for the current year. The Zacks Consensus Estimate for ATI's current-year earnings has been revised 12.5% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.

ATI’s earnings beat the Zacks Consensus Estimate in the last four quarters. It has a trailing four-quarter earnings surprise of 128.9%, on average. The stock has surged 71% in a year.

Albemarle has a projected earnings growth rate of 247% for the current year. The Zacks Consensus Estimate for ALB’s current-year earnings has been revised 7.8% upward in the past 60 days.

Albemarle’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average being 20%. ALB has gained roughly 30% in a year and has a Zacks Rank of 1 at present.

 


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MAG Silver Corporation (MAG) - free report >>

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