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Endeavor Silver Shows Strength in 2014

By  +Follow February 21, 2014 8:46AM
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Small-Cap Star Endeavor Silver Corp. (EXK) had a rocky 2013, with big gains and losses. On the whole, the company started the year still in a lengthy downtrend that took the stock from its peak in 2011 at more than $12.50 to its 52-week low of $2.88 in early July of last year.

Rebounding Silver Prices, Strong Production Drive Gains

Of course, it’s hard to see this as reflecting too harshly on Endeavor as a company as its stock peaked around the same time silver prices did. Silver came very near touching $50 an ounce in Q2 of 2011, and by early July of last year it was under $20 an ounce.

However, silver is bouncing back and Endeavor with it in 2014. However, other junior silver miners would be hard pressed to match the over 55 percent gain experienced by Endeavor since the beginning of 2014. The company released strong 2014 projections on Jan. 22, with guidance for its three underground mine in Mexico (Guanaceví Mine in Durango State and the Bolañitos and El Cubo Mines in Guanajuato State) apparently impressing investors and traders alike.

"After delivering tremendous production growth in 2013, we plan to hold production relatively steady for 2014, hone the operations and position the Company for a turnaround in metal prices later this year,” said CEO Bradford Cooke at the time. “Our capital budget is significantly reduced this year which will help boost free cash-flow."

"Our focus this year will be on further refining our operating and financial performance through initiatives to improve productivity, reduce operating costs and enhance cash-flow at all three mines, as well as completing the operational turn-around at El Cubo,” he continued. “We have resumed exploration around the mines in order to replace depleted reserves and expand resources, but green-fields exploration will be minimized to drilling our emerging new, high grade discovery at the San Sebastián property."

Strong Technical Signs During Current Uptrend

On the whole, Endeavor’s stock has been sharply positive this year. The stock crossed its 20-day moving simple moving average (SMA) in December, butted up against its 50-day SMA for about a week in early January before breaking through, and crashed through its 200-day SMA by mid-month. The sharp climb that took it through the 200-day SMA hit resistance at around $4.70 a share and retreated once before breaking through. Since then, it’s been climbing and hasn’t looked back, currently hovering near $5.65 a share and a 52-week high.

Fundamental Analysis Also Appears Strong

A look at Endeavor’s fundamentals may indicate why the stock has so much strength. The company managed to dramatically increase revenue from 2011 to 2012 despite crashing silver prices during this period, and its P/E ratio is fairly solid and just under 13.

And if one uses the DuPont Model for analysis, there’s more reason to potentially feel bullish about the stock. While a first look at Endeavor’s ROE shows it coming in well below industry average, a deeper look shows a company trending in the right direction for the right reasons.

Endeavor’s net margins, a key indicator, are significantly better than the industry average. And while the company is well below industry average for asset turnover and equity multiplier, it’s worth noting that, if you have to choose, it’s better to be below average than above for the equity multiplier. A lower equity multiplier means less debt, and while industry average is ideal, less debt is better than more debt in most cases.

What’s more, looking at trends over time, Endeavor’s ROE, net margin, and asset turnover are all improving year-over-year. Net margins improved considerably from 2011 to 2012, as did ROE, and asset turnover appears to be trending closer to industry average.

On the whole, Endeavor appears to be a promising stock that, while dependent on silver prices maintaining some stability, may also be a best-in-breed pick for junior silver miners. There’s clearly some potential here that 2014’s gains aren’t a mirage and this company could keep growing.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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Results for EXK
Smaulgld
1 Sep 14 08:40:07
RT @Bailonomics: China is now #1 Gold Producer/#2 Silver Producer #1 Solar Manufacturer $JNUG $EXK $$GDX $NUGT $GDXJ $ANV $SLV $GLD http:/…
Louis Cammarosano
1 Sep 14 08:39:40
RT @Bailonomics: China is now #1 Gold Producer/#2 Silver Producer #1 Solar Manufacturer $JNUG $EXK $$GDX $NUGT $GDXJ $ANV $SLV $GLD http:/…
Bail O'Nomics
1 Sep 14 08:39:20
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Bail O'Nomics
29 Aug 14 09:26:53
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Financial News
29 Aug 14 03:19:01
$EXK: Harmony Gold's Strategic Steps Show Promise Amid Challenges http://t.co/T01ze2oLFR http://t.co/se4hZyFYq9
Investors Hangout
29 Aug 14 03:03:36
Stock_Tracker: Endeavour Silver Corp (EXK) 5.61 $EXK Shares of http://t.co/jfT9Ps0Z28
Investors Hangout
29 Aug 14 03:03:11
Stock_Tracker: Endeavour Silver Corp (EXK) 5.61 $EXK Shares of http://t.co/j9qtuSq1GX
iHangout
29 Aug 14 03:02:31
http://t.co/Vv1sYDyeQn Stock_Tracker: Stock DD Board: Endeavour Silver Corp (EXK) 5.61 $EXK Shares of http://t.co/wEUmBIx3w7
Peter Nees
28 Aug 14 17:18:59
Silver top: $EXK, $SLW.TO, $AG. Full list: http://t.co/JMnX6iAqJy
Investors Hangout
27 Aug 14 10:26:19
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27 Aug 14 10:18:58
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27 Aug 14 08:25:06
$EXK - Report of Foreign Issuer (6-k) http://t.co/ksodcXThiF
Financial Updates
27 Aug 14 08:19:12
$EXK: Stock To Watch: Endeavour Silver (EXK) In Perilous Reversal http://t.co/wrb7xVwRnz http://t.co/07gRAS0qCW
Investors Hangout
27 Aug 14 07:15:27
clayton: $EXK 5.59 http://t.co/M2qQSWJJcX
Investors Hangout
27 Aug 14 07:15:20
clayton: $EXK 5.59 http://t.co/nPqRsCH93P
Briefing.com
27 Aug 14 07:09:49
$EXK: Endeavour Silver continues to intersect high grade silver-gold mineralization in Terronera vein at San... http://t.co/3XQSajDmfr
clayton
27 Aug 14 07:01:55
$EXK 5.59 http://t.co/tgKVdexKsC
Trader Bob
27 Aug 14 06:57:31
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27 Aug 14 06:55:02
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27 Aug 14 06:54:06
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The Fly
27 Aug 14 05:06:30
$EXK Endeavour Silver reports continued high grade silver-gold veins at San Sebastian: Full Story http://t.co/jsR9GGGU5w
Stock Market News
26 Aug 14 23:18:53
$EXK: Harmony Gold's Strategic Steps Show Promise Amid Challenges http://t.co/gcrC8yhPFT http://t.co/0jwOV8Qggd
Market Headlines
26 Aug 14 22:18:58
$EXK: 2 Companies That Could Benefit From a Silver Rally http://t.co/LigDWMsmds http://t.co/rRJ9mMkTJ4
OTPicks.com
26 Aug 14 22:07:13
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26 Aug 14 19:01:21
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26 Aug 14 13:47:47
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Bill Tsamis
26 Aug 14 10:31:49
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Companies in News
26 Aug 14 10:18:55
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26 Aug 14 08:19:06
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By  +Follow February 21, 2014 8:46AM
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