Jaguar Mining Inc. (JAG:TSX) posted a Q1/23 that met expectations, reported Research Capital Corp. analyst Stuart McDougall in a May 11 research note.
"We have updated our model for the results and continue to recommend purchase as a Buy," McDougall wrote.
122% Possible Return
The analyst pointed out that this Canadian gold miner offers investors significant potential return, of 122%. This is reflected in the difference between Jaguar's current share price, CA$2.37, and Research Capital's target price on it, CA$5.25 per share.
Highlights of Results
McDougall summarized Jaguar Mining's Q1/23 results.
During the quarter, this company with two underground mines in Brazil's Iron Quadrangle sold 19,008 ounces of gold.
Unadjusted earnings per share (EPS) came in at US$0.03, Research Capital's exact forecast.
Cash flow per share (CFPS), however, was lower than expected, due primarily, McDougall noted, to higher cash taxes. CFPS was US$0.14; Research Capital estimated it would be US$0.16.
No Cost Surprises
As for costs, average total cash costs were on par, at US$1,084 per ounce (US$1,084/oz). This compared to Research Capital's projection of US$1,086/oz.
Jaguar Mining's Q1/23 all-in sustaining cost (AISC) came to US$1,575/oz, slightly above Research Capital's US$1,541/oz expectation.
"Stock-based compensation essentially account[ed] for the difference," McDougall explained.
Reported sustaining capex was US$7.2 million (US$7.2M), generally in line with Research Capital's US$6.9M estimate.
Balance Sheet Status
At Q1/23's end, Jaguar Mining had US$25.8M of cash, US$20.8M of working capital and US$7.1M of debt.
"We still do not foresee any requirements for external financing, barring any unforeseeable development," McDougall wrote.
For the Full Year
Jaguar Mining reiterated its guidance for full-year 2023 (FY23), noted McDougall. It expects to produce a total of 84,000–88,000 ounces of gold at an AISC of US$1,275–1,375/oz.
Compared to guidance, Research Capital estimates Jaguar's production for FY23 will wind up being in the lower end and AISC will be higher than the provided range, more like around US$1,415/oz.
"We expect the next three quarters to each to contribute about 22,000 oz at a consolidated total cash cost of about US$970/oz and an AISC of about US$1,365/oz," McDougall wrote.
Research Capital maintained its FY23 EPS and CFPS estimates for Jaguar (based on a flat gold price of US$1,850/oz) of US$0.24 and US$0.78, respectively.
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Disclosures for Research Capital Corp., Jaguar Mining Inc., May 11, 2023
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