YAMANA GOLD $4.48 - Toronto symbol YRI

YAMANA GOLD $4.48 (Toronto symbol YRI; TSINetwork Rating: Speculative) (416-815-0220; www.- yamana.com; Shares outstanding: 880.8 million; Market cap: $4.0 billion; Dividend yield: 1.5%) owns eight operating gold mines in Mexico, Brazil, Chile and Argentina. It also holds a 12.5% stake in the Alumbrera copper/gold mine in Argentina and has a number of other properties in advanced stages of development.

Yamana’s mines include 50% of the Canadian Malartic gold project in Quebec. The company teamed up with Agnico-Eagle Mines in June 2014 to buy Osisko Mining, which owned Canadian Malartic, for $1.5 billion each (all figures except share price and market cap in U.S. dollars).

In the three months ended September 30, 2014, Yamana’s gold equivalent production (including copper and silver, which are significant by-products of the company’s gold mining) rose 27.5%, to 391,277 ounces from 306,935.

Cash flow gained 10.5%, to $196.0 million from $177.4 million. However, cash flow per share fell 8.3%, to $0.22 from $0.24, on more shares outstanding due to the Osisko acquisition.

Yamana holds cash of $169.2 million, or $0.19 a share. Its $2.0 billion of debt is a high, but manageable, 50.0% of its market cap.

The company will likely produce almost 1.4 million ounces of gold in 2014, rising to over 1.5 million ounces in 2015.

Yamana Gold is a buy for aggressive investors.

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