Pan American Silver Corp. (TSE:PAAS) First-Quarter Results: Here's What Analysts Are Forecasting For This Year

Shareholders of Pan American Silver Corp. (TSE:PAAS) will be pleased this week, given that the stock price is up 12% to CA$27.86 following its latest quarterly results. It looks like the results were pretty good overall. While revenues of US$601m were in line with analyst predictions, statutory losses were much smaller than expected, with Pan American Silver losing US$0.08 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for Pan American Silver

Taking into account the latest results, the current consensus from Pan American Silver's four analysts is for revenues of US$2.71b in 2024. This would reflect a satisfactory 7.4% increase on its revenue over the past 12 months. Earnings are expected to improve, with Pan American Silver forecast to report a statutory profit of US$0.45 per share. In the lead-up to this report, the analysts had been modelling revenues of US$2.71b and earnings per share (EPS) of US$0.17 in 2024. Although the revenue estimates have not really changed, we can see there's been a considerable lift to earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.

The consensus price target was unchanged at CA$32.23, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Pan American Silver, with the most bullish analyst valuing it at CA$34.38 and the most bearish at CA$30.09 per share. This is a very narrow spread of estimates, implying either that Pan American Silver is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that Pan American Silver's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 9.9% growth on an annualised basis. This is compared to a historical growth rate of 14% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 12% per year. Factoring in the forecast slowdown in growth, it seems obvious that Pan American Silver is also expected to grow slower than other industry participants.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Pan American Silver's earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Pan American Silver's revenue is expected to perform worse than the wider industry. The consensus price target held steady at CA$32.23, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Pan American Silver going out to 2025, and you can see them free on our platform here.

Before you take the next step you should know about the 1 warning sign for Pan American Silver that we have uncovered.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.