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Coeur Mining Inc (CDE), Endeavour Silver Corp. (CAN) (EXK): Consider This Silver Miner That Trades at a Discount to Book

Valuation
The fact that Coeur Mining Inc (NYSE:CDE) d’Alene is not profitable could worry investors. However, the company has $250 million in cash on its balance sheet. In addition to that, Coeur Mining Inc (NYSE:CDE) d’Alene has $100 million of undrawn credit facility. The company has lost $35 million in the second quarter, and has a sufficient cushion to turn itself to profitability.

Coeur Mining Inc (NYSE:CDE) d’Alene has just $300 million of long-term debt. The absolute majority of its debt portfolio consists of 7.875% notes due 2021. This is a relatively light debt load.

In the meantime, Coeur d’Alene trades at 0.65 times book value. In comparison, Endeavour Silver Corp. (CAN) (NYSE:EXK) Silver trades at 1.48 P/B and First Majestic Silver Corp (NYSE:AG) trades at 2.77 P/B. Coeur d’Alene looks cheap compared to its peers.

Bottom Line
Coeur d’Alene has suffered a hefty drop this year, leading shares to trade at a significant discount to book value. If you believe that silver prices will continue to rebound, Coeur d’Alene could be a cheap option.

It’s important to notice that silver miners are overwhelmingly dependent upon the price of silver, so if the price continues to fall, there’s little they can do to prevent their shares from depreciating further.

The article Consider This Silver Miner That Trades at a Discount to Book originally appeared on Fool.com is written by Vladimir Zernov.

Vladimir Zernov has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. 

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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