Roth Capital ups target price for Silvercorp Metals to $9.00, reiterates 'Buy' rating following recent Q4 results

Roth Capital has raised its target price for Silvercorp Metals Inc. (CVE:SVM) to $9.00 from $8.75 and reiterated its ’Buy’ rating on the stock following recent fiscal Q4 and full-year 2021results from the company.

In a note to clients, Roth’s analysts noted that Silvercorp’s revenue of $35.7 million in Q4 was slightly below their estimate of $36.2 million due to price realizations, however, Q4 EPS of $0.04 was in line with the analysts’ estimate.

They concluded: “Other than the slight revenue shortfall, results were uneventful, in our view.”

READ: Silvercorp Metals records upswing in net income and revenue as it posts latest fiscal year results

The Roth analysts estimate that Silvercorp will report production of 6.6 million ounces of silver, 27.4 million pounds of zinc, 67.6 million pounds of lead, and 2,800 ounces of gold in fiscal 2022.

As a result, they estimate the company’s fiscal 2022 free cash flow (FCF) to equity to be $50.9 million. The analysts noted that Silvercorp’s fiscal 2022 and 2023 cash flow should benefit from a temporarily lower take rate.

The Roth analysts also said that they anticipate Silvercorp should generate strong free cash flow in 2022 and beyond.

Additionally, they believe the company remains undervalued compared to its peer group and that there is significant upside for the company’s equity investments, which could provide external catalysts for the company.

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Story by ProactiveInvestors