Pan American Silver: Entering The New Year At A Reasonable Valuation

• Pan American Silver was one of the worst-performing precious metals stocks in 2021, down 28% vs. an 11% decline in the Gold Miners Index.
• The underperformance was attributed to lower production and higher costs than planned, with ventilation constraints at La Colorada, inflationary pressures, and lower grades at San Vincente.
• Fortunately, Pan American should have a much better year ahead, with increased mining rates at La Colorada, and what should be less COVID-19 related headwinds impacting productivity.
• Based on Pan American being one of the lowest-risk ways to get silver exposure, with the bonus of a leading dividend yield among peers, I would view pullbacks below $23.15 as low-risk buying opportunities.