CC&V Integration And Hod Maden Advancements Will Boost Production

Key Takeaways

• Ongoing project developments and reserve growth initiatives provide clear pathways for increased production, higher margins, and sustainable long-term revenue.
  
• Financial strength and a favorable market environment enable strategic expansion and potential shareholder value growth through both organic and inorganic opportunities.
  
• Prolonged project delays, inflation, regulatory risks, and rising costs threaten margins, cash flow, and the value of recent acquisitions due to uncertainty and exposure in key regions.

Catalysts

Engages in the acquisition, exploration, and development of precious metal resource properties in the United States, Türkiye, Canada, and Argentina.

• The integration and ramp-up of Cripple Creek & Victor (CC&V), with an 85% increase in reported reserves and an upcoming technical report, offers visibility on long-term production growth and potential operating efficiencies, which should enhance both revenue and future net margins.
  
• Advancements at Hod Maden, supported by ongoing investment and detailed engineering work, signal the addition of another low-cost, high-return project to the portfolio; once operational, this should materially increase annual production and cash flow, supporting higher earnings and margin expansion.
  
• The company’s focus on mine life extensions at existing operations (Marigold, Puna, Seabee), through brownfield exploration and resource conversion, supports sustainable long-term output and underpins revenue growth while offsetting industry reserve depletion challenges.
  
• Strong free cash flow generation and balance sheet flexibility position SSR Mining to capitalize on further accretive growth opportunities (including M&A or organic expansion), which can drive higher earnings per share and shareholder value.
  
• Sustained global geopolitical uncertainty and inflationary pressures are likely to support elevated gold and silver prices, providing a constructive demand environment that could increase SSR Mining’s realized prices and revenue base for the foreseeable future.

SSR Mining Future Earnings and Revenue Growth

Assumptions

• Analysts are assuming SSR Mining's revenue will grow by 30.3% annually over the next 3 years.
• Analysts assume that profit margins will increase from 7.8% today to 35.3% in 3 years time.
• Analysts expect earnings to reach $845.1 million (and earnings per share of $2.68) by about July 2028, up from $84.6 million today.
• In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 4.3x on those 2028 earnings, down from 30.8x today. This future PE is lower than the current PE for the CA Metals and Mining industry at 17.5x.
• Analysts expect the number of shares outstanding to grow by 0.34% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 6.84%, as per the Simply Wall St company report.

SSR Mining Future Earnings Per Share Growth

Risks

• Ongoing inflationary pressures in Turkey, especially since the last Hod Maden feasibility estimate was from 2022 and management anticipates no relief from high inflation rates, could cause capex overruns and weaker project economics, negatively impacting future net margins and returns.
  
• The continued care and maintenance status at Copler, with uncertainty around when (or if) permitting for a restart will be received, creates a significant risk of prolonged revenue loss and ongoing operating costs with no clear resolution, directly limiting future free cash flow and earnings.
  
• SSR Mining’s expanding commitment to Turkey (Hod Maden and Copler) exposes the company to elevated geopolitical and regulatory risks; changes in the Turkish government’s permitting, inflation, or regulatory posture could result in further operational delays or unexpected costs, putting company-wide revenue and margins at risk.
  
• The company’s reliance on major recent acquisitions, notably Cripple Creek & Victor (CC&V), brings integration and execution risk—if synergies or production targets are not realized, or if technical or geological assumptions prove too optimistic (as new technical reports replace outdated ones), there is potential for disappointment in expected cash flow and value creation.
  
• Increasing input and sustaining capital costs industrywide (energy, labor, consumables), especially for projects in inflationary or remote regions, may outpace commodity price gains; this trend could squeeze SSR Mining’s AISC and erode net margins, despite higher production targets.

Valuation

• The analysts have a consensus price target of CA$20.064 for SSR Mining based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of CA$23.92, and the most bearish reporting a price target of just CA$14.58.
• In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $2.4 billion, earnings will come to $845.1 million, and it would be trading on a PE ratio of 4.3x, assuming you use a discount rate of 6.8%.
• Given the current share price of CA$17.5, the analyst price target of CA$20.06 is 12.8% higher.
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.