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Ever wondered if Pan American Silver’s stock is truly a hidden gem or if the market has already priced in its shine? You are not alone, as valuation is top of mind for investors looking for opportunity.
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After some ups and downs this month, the stock is still riding an impressive wave, with a 71.0% gain year-to-date and an even bigger 74.9% jump over the past year.
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Beyond the returns, recent news highlights increasing interest in precious metals as safe havens, and Pan American Silver is grabbing attention alongside renewed activity in the mining sector. A string of positive industry sentiment and a broader market appetite for gold and silver explorers have underpinned much of the recent share price momentum.
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Despite the surge, Pan American Silver scores just 2 out of 6 valuation checks on our screen for undervaluation. Next, we will break down the traditional valuation approaches. Stick around for an even more insightful way to think about value at the end of this article.
Pan American Silver scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.
The Discounted Cash Flow (DCF) model estimates the intrinsic value of a company by projecting its future cash flows and discounting them back to their present value. This approach attempts to answer what Pan American Silver should be worth today if we anticipate and appropriately value all the cash it could generate in the years ahead.
Currently, Pan American Silver reports Free Cash Flow (FCF) of $561 million. Analysts have provided FCF estimates through 2027, with projections showing a peak of $1.55 billion in 2026 and $1.27 billion in 2027. Beyond that, future amounts are extrapolated. By 2035, the estimated FCF is just under $1 billion at $978.9 million, according to these forecasts.
Based on this two-stage FCF analysis, the DCF model calculates an intrinsic value of $63.48 per share. Compared to the current share price, this implies the stock is trading at a 17.0% discount to its fair value. This may signal potential undervaluation if the market has not fully priced in its expected future earnings power.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Pan American Silver is undervalued by 17.0%. Track this in your watchlist or portfolio, or discover 869 more undervalued stocks based on cash flows.
The Price-to-Earnings (PE) ratio is a widely used metric for assessing the value of profitable companies, like Pan American Silver. It tells investors how much they are paying for each dollar of the company’s earnings, making it especially relevant when a business is consistently generating profits.
