Great Panther Silver Earnings: An Early Look

Earnings season is winding down, with most companies already having reported their quarterly results. But there are still some companies left to report, and Great Panther Silver (GPL) is about to release its quarterly earnings. The key to making smart investment decisions with stocks releasing their quarterly reports is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Mining stocks have gotten crushed over the past year, and Great Panther Silver has been having to deal with the same headwinds as many other players in the silver-mining industry. Let's take an early look at what's been happening with Great Panther Silver over the past quarter and what we're likely to see in its quarterly report on Wednesday.

Stats on Great Panther Silver

Source: S&P Capital IQ.
*Normalized.

Will Great Panther Silver shine brighter this quarter?
Great Panther doesn't have a big analyst following, but the stock's recent plunge certainly shows that investors aren't convinced about its future prospects. Shares have fallen another 17% since early December and are down more than 45% since this time last year.

Great Panther has staked its claim in the lucrative Guanajuato area of Mexico, where a number of other companies have also found promising silver plays. Endeavour Silver (EXK -0.73%) has two mines that directly adjoin holdings of Great Panther's, while AuRico Gold (NYSE: AUQ) owned assets in the area before selling them to Endeavour last year for $250 million.

Yet despite the potential of Guanajuato, Great Panther has faced some difficulties there. Back in November, the company cut its production estimates for the full 2012 year, citing variations in ore grades and high smelting and refining costs as a factor in raising its cash-cost estimate by $1.50 per ounce. Fortunately, by the time Great Panther released preliminary production results in January, its actual 2012 production came in at 2.38 million silver-equivalent ounces, toward the top of its revised range. Yet Great Panther's 2013 guidance didn't show huge prospects for growth looking forward, with production seen growing just 1% to 5%.

In its quarterly report, watch Great Panther not just for its silver exposure but also with an eye toward gold production, which has been rising at a strong rate at Guanajuato. Unless the company can come up with some stronger growth projections, though, it's hard to see investors getting too excited about Great Panther unless bullion prices start moving higher.

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