Silver’s versatility makes it useful in numerous fields. It is utilized in electronics, jewelry, phones, computers, vehicles, and photography. Because of its conductivity, silver is a crucial part of solar energy too. Most of us know this, so what’s the big deal? The answer is demand.
In 2022, 1.25 billion ounces of silver were used, setting a new all-time high. Investment in physical silver jumped by 22%, jewelry sales rose by 29%, and silverware sales increased by 80%. The Silver Institute forecasts that industrial production will reach a record high in 2023, beating the previous record set last year. Looking ahead, the electric vehicle transition, widespread deployment of 5G, and the government’s emphasis on green infrastructure are all factors that will only further boost silver’s demand.
Many investors are still determining precisely where to place their hard-earned funds as recession fears continue. In that context, the precious metals sector is a bullish option, and silver is an inexpensive alternative to gold. If demand for the metal continues to rise as expected, shareholder profits will as well.
I’ll now break down three affordable silver stocks that seem to not get enough attention. But, experts who are privy to silver’s strength agree we should consider these illuminating equities:
Pan American Silver Corp (PAAS)
Pan American Silver Corp. (PAAS) manages, expands, and discovers silver and gold mines. PAAS was founded in Vancouver, Canada, on March 17th, 1979, by Ross Beaty and John Wright. The long-awaited acquisition of Yamana Gold Inc. by PAAS was finalized not too long ago. This deal is a game-changer, solidifying PAAS as South America’s preeminent silver and gold producer and increasing its number of active mines to 12. Up by 3.27% YTD, PAAS has a $6.4 billion market cap, a 0.63 beta, a P/E ratio of 27x, and a P/S ratio of 2.3x. PAAS shows TTM revenue of $1.49 billion, from which it profited $319 million. PAAS offers an annual dividend of 2.37% and a quarterly payout of 10 cents ($0.40/yr) per share. With a 10-day average volume of 4.82 million shares, PAAS has a median price target of $23.80, with a high of $30 and a low of $21, representing a potential price leap of 78%. Analysts tell us to buy and hold PAAS.
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Compania de Minas Buenaventura SAA (BVN)
Compañía de Minas Buenaventura SAA (BVN), or simply Buenaventura, engages in developing and exploring mines. Mineral production and sales, power generation and transmission, and manufacturing are BVN’s main areas of business operation. BVN was founded on September 7th, 1953, by Alberto Benavides de la Quintana, and its headquarters are in Lima, Peru. BVN is down by 5.77% YTD and is considered by some to be undervalued. BVN has a $1.8 billion market cap, a P/E ratio of 13.3x, a P/S ratio of 2.33x, a P/B ratio of 0.61x, and a D/E of 23.93%, with a safe 0.52 beta score. BVN reports a TTM revenue of $812 million at $2.14 per share, and it profited $63.3 million via a 15.27% net margin. BVN has an operating free cash flow of $65.72 million, and its revenue and EPS are expected to grow significantly in the coming years. BVN has a dividend yield of 1.19% and a quarterly payout of 7 cents ($0.28) per share. With a 10-day average volume of 1.3 million shares, BVN has a median price target of $9.20, with a high of $16.86 and a low of $8. The high end of this range would make for an impressive 140% increase from current pricing, and analysts are telling us to buy and hold BVN.
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Endeavour Silver Corp (EXK)
Endeavour Silver Corp. (EXK) buys, explores, and develops sites that can produce precious metals in Mexico and Chile. In the two nations, EXK is working on the Terronera and El Compas mines, as well as its Guanacevi and Bolanitos projects. Bradford James Cooke founded EXK on March 11th, 1981, and it operates from its Vancouver, Canada headquarters. EXK is up YTD by 6.33%, and while it may not show figures similar to its peers on the list, its forecasts offer nothing but an upside. With a market cap of $660 million, its TTM revenue is $210 million, from which it profited $6.2 million with a modest 2.95% net margin. EXK has a P/S ratio of 2.85x and a P/B ratio of 2.53x, with forecasted 1-year EPS growth of 175% and 5-year EPS growth of 1,249%. At its most recent earnings call, it exceeded analysts’ EPS projections by 55.06% and revenue by 3.72%. EXK is expected to show $55.2 million in sales for the current quarter with a $0.04 EPS. With a 10-day average trading volume of 2.86 million shares, analysts have assigned EXK a median price target of $5.37, with a high of $6 and a low of $4.11. Even the low end of this range would give EXK over a 19% price jump from where it sits currently, and its high mark would represent a more than 74% increase. The analysts largely agree; for EXK, they tell us to buy and hold.
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– Adam @ Wall St. Watchdogs
