CIBC Capital Markets on Tuesday reiterated its outperformer rating on the shares of Endeavour Silver (EDR.TO, EXK) and its C$16.00 price target after the company sold its Bolanitos mine in Mexico to Guanajuato Silver (GSVR.V).

"Endeavour Silver announced that it has entered into a definitive agreement with Guanajuato Silver Company Ltd. to sell the Bolanitos mine for an upfront payment of $40M with an additional $10M in contingent considerations. The upfront payment consists of $30M payable in cash and $10M payable in common shares of Guanajuato Silver while the contingent payments are paid in two tranches, upon two million and four million ounces of silver-equivalent produced from the asset. At spot, we value the asset at ~$60M, representing an acquisition multiple of ~0.83x P/NAV, which is relatively in line with heavily gold-weighted assets. Overall, with increased capital expenditure at Bolanitos as the asset nears the end of its life of mine, we believe that the divestment of Bolanitos will allow the company to place additional attention on its optimization efforts at Terronera. We reiterate our Outperformer rating. At spot, EDR shares are currently trading at a discount of 0.8x P/NAV and 3.7x P/CF compared to peers at 1.0x P/NAV and 7.9x P/CF," analyst Cosmos Chiu wrote.

(MT Newswires covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://www.mtnewswires.com/contact-us)

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