Sector Expert: Andrew Kaip

BMO Capital Markets

Image: Andrew Kaip

Andrew Kaip is managing director of mining equity research at BMO Capital Markets. Previously, he worked as a mining analyst at Haywood Securities, most recently covering gold and silver junior exploration and mining companies. Prior to that, he served as a project and consulting geologist for more than 10 years. Kaip received his Bachelor of Science in geology from Carleton University and his Master of Science in economic geology from the University of British Columbia and is a professional geologist.

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Recent Interviews

BMO's Andrew Kaip: The Gold Majors Are Back (7/30/15)
Molten gold

Andrew Kaip, managing director of mining equity research at BMO Capital Markets, does not expect near-term higher prices for gold or silver. However, due to continuing cost cutting and other efficiencies, he argues that the senior gold producers can now make profits above $1,100/oz gold. In this interview with The Gold Report, Kaip names two seniors as Sector Outperformers, and touts the virtues of a half-dozen undervalued near-term gold and silver producers.

BMO Capital Markets' Andrew Kaip Says Get Ready for the Consolidation Wave (12/22/14)
Crystal ball

Andrew Kaip, managing director of mining equity research at BMO Capital Markets, says the stark reality is that the precious metals sector is only part way through a down cycle and that structural issues will result in a fresh phase of consolidation. He adds that the small to intermediate producers will lead the consolidation charge. In this interview with The Gold Report, Kaip suggests some suitors and prime acquisition candidates.

Silver Summit Report: Three Investment Approaches to the Volatile Metal (10/21/11)

For this special report from the Cambridge House Silver Summit in Spokane, Washington, The Gold Report caught up with three silver investing experts: James Turk, chairman of GoldMoney; Andrew Kaip, vice president of Precious Metals & Mining at BMO Capital Markets; and Ian McAvity, a writer at Deliberations on World Markets. While the three didn't all agree on why silver acts the way it does, they all said that it belongs in some form in a diversified portfolio—but only for those who can handle volatility.

Recent Quotes

"SLW had higher-than-expected silver sales at Antamina and Penasquito in Q2/16."

— Andrew Kaip, BMO Capital Markets (8/10/16)
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"Strong silver production was driven by higher-than-expected silver grades at Escobal and THO expects to achieve the top end of silver guidance."

— Andrew Kaip, BMO Capital Markets (8/10/16)
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"SLW announced the acquisition of an additional 25% gold stream from the Salobo Mine in Brazil."

— Andrew Kaip, BMO Capital Markets (8/2/16)
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"Salobo has a 48-year mine life, providing SLW a cornerstone long-lived stream."

— Andrew Kaip, BMO Capital Markets (5/24/16)
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"We expect SLW will become increasingly attractive to generalist investors re-entering the sector and seeking exposure to silver."

— Andrew Kaip, BMO Capital Markets (5/11/16)
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"SLW's earnings beat resulted from higher-than-expected silver sales from the Antamina stream."

— Andrew Kaip, BMO Capital Markets (5/9/16)
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"THO's solid earnings beat appears attributable to better-than-expected silver production at Escobal and slightly lower operating costs."

— Andrew Kaip, BMO Capital Markets (5/3/16)
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"SLW's financing provides it greater flexibility to execute on future streaming transactions."

— Andrew Kaip, BMO Capital Markets (4/7/16)
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"THO's improved free cash flow profile reinforces its ability to self-fund future growth initiatives."

— Andrew Kaip, BMO Capital Markets (4/4/16)
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"SLW's Q4/15 adjusted EPS came in at $0.14, slightly above our estimate."

— Andrew Kaip, BMO Capital Markets (3/16/16)
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"The CRA audit may enable SLW shares to resume trading on fundamentals."

— Andrew Kaip, BMO Capital Markets (1/19/16)
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"SLW's Antamina stream provides immediate cash flow and a 4.5% IRR."

— Andrew Kaip, BMO Capital Markets (11/3/15)
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"G reported better than expected Q3/15 production, costs and cash flow."

— Andrew Kaip, BMO Capital Markets (10/29/15)
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"FNV and First Quantum finalized terms for the Cobre Panama stream deal."

— Andrew Kaip, BMO Capital Markets (10/5/15)
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"R and OceanaGold shareholders have approved the acquisition."

— Andrew Kaip, BMO Capital Markets (9/28/15)
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"We are initiating coverage of FNV with an Outperform rating."

— Andrew Kaip, BMO Capital Markets (9/13/15)
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"It is very apparent G's Éléonore mine is built for the long term."

— Andrew Kaip, BMO Capital Markets (9/10/15)
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"G reiterated guidance to full production at Eleonore in H1/18."

— Andrew Kaip, BMO Capital Markets (9/9/15)
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"G's move to combine projects with Teck Resources appears prudent."

— Andrew Kaip, BMO Capital Markets (8/27/15)
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"R's pit development is 63% ahead of schedule."

— Andrew Kaip, BMO Capital Markets (8/25/15)
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"SLW's Q2/15 EPS came in slightly above expectations."

— Andrew Kaip, BMO Capital Markets (8/11/15)
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"THO has set a goal of reducing G&A costs by $4M in 2015."

— Andrew Kaip, BMO Capital Markets (8/11/15)
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"New CEO Kevin McArthur has experience, an intimate understanding of THO and a strong track record."

— Andrew Kaip, BMO Capital Markets (8/5/15)
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"GUY's first gold pour marks a derisking of the Aurora project."

— Andrew Kaip, BMO Capital Markets (8/4/15)
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"G generated $211M of free cash flow in Q2/15."

— Andrew Kaip, BMO Capital Markets (7/30/15)
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"OceanaGold's 72% premium for the R acquisition provides significant value to the latter's shareholders."

— Andrew Kaip, BMO Capital Markets (7/30/15)
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"AKG is one of the opportunities in what we call predevelopment names."

The Gold Report Interview with Andrew Kaip (7/30/15)
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"BCM has one of the best-quality assets of any silver junior."

The Gold Report Interview with Andrew Kaip (7/30/15)
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"GUY's share price has done very well relative to its peers."

The Gold Report Interview with Andrew Kaip (7/30/15)
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"MAG's Juanicipio project is high quality but early stage, with production forecast for 2018."

The Gold Report Interview with Andrew Kaip (7/30/15)
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"R is building toward a Q4/16 first pour at its Haile mine in South Carolina."

The Gold Report Interview with Andrew Kaip (7/30/15)
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"SLW has a great business model."

The Gold Report Interview with Andrew Kaip (7/30/15)
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"THO is a solid company with a fine silver mine in Guatemala and two fine assets in Peru."

The Gold Report Interview with Andrew Kaip (7/30/15)
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"We expect G will show free cash flow sufficient to support its dividend, repair its balance sheet and invest in future opportunities."

The Gold Report Interview with Andrew Kaip (7/30/15)
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"We expect silver deliveries to SLW to resume, positively impacting H2/15 EPS."

— Andrew Kaip, BMO Capital Markets (7/15/15)
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"THO has a low free cash flow breakeven gold price."

— Andrew Kaip, BMO Capital Markets (7/13/15)
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"GUY's high-grade gold mine is projected to support attractive low free cash flow breakeven gold prices."

— Andrew Kaip, BMO Capital Markets (7/13/15)
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"We expect SLW to vigorously defend its position to the CRA."

— Andrew Kaip, BMO Capital Markets (7/7/15)
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"THO stock is a compelling opportunity for investors."

— Andrew Kaip, BMO Capital Markets (6/30/15)
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"We are initiating coverage of G with an Outperform rating."

— Andrew Kaip, BMO Capital Markets (6/15/15)
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"BCM announced a revised feasibility study with improved recoveries."

— Andrew Kaip, BMO Capital Markets (6/2/15)
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"R continues to advance its construction activities at Haile."

— Andrew Kaip, BMO Capital Markets (6/1/15)
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"GUY's shares remain poised for a positive rerating."

— Andrew Kaip, BMO Capital Markets (5/27/15)
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"We forecast SLW to grow Ag eq production by 17% during 2015."

— Andrew Kaip, BMO Capital Markets (5/7/15)
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"Free cash flow generation of $15.9M highlights a strong Q1/15 for AR."

— Andrew Kaip, BMO Capital Markets (5/5/15)
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"THO's strong Q1/15 EPS beat was driven by improved operating costs."

— Andrew Kaip, BMO Capital Markets (4/28/15)
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"Wider widths in the Valdeca˝as vein highlight another opportunity for MAG."

— Andrew Kaip, BMO Capital Markets (4/23/15)
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"MND's Q1/15 sales were in line with our forecasts."

— Andrew Kaip, BMO Capital Markets (4/13/15)
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"THO is working toward an early 2016 start-up for Shahuindo."

— Andrew Kaip, BMO Capital Markets (4/13/15)
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"We are removing the Speculative rating on THO's shares."

— Andrew Kaip, BMO Capital Markets (4/8/15)
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"THO is projected to maintain lower-quartile cash costs."

— Andrew Kaip, BMO Capital Markets (4/2/15)
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"We expect GUY to commence commercial production at Aurora by late Q3/15."

— Andrew Kaip, BMO Capital Markets (3/30/15)
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"SLW's latest Salobo transaction is 12% accretive to net present value."

— Andrew Kaip, BMO Capital Markets (3/19/15)
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"In 2014, AR built its cash balance by $6.9M in a depressed market."

— Andrew Kaip, BMO Capital Markets (3/16/15)
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"SLW's restructuring of its credit facility enhances financial flexibility."

— Andrew Kaip, BMO Capital Markets (3/2/15)
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"Construction activities at GUY's Aurora are on schedule and budget."

— Andrew Kaip, BMO Capital Markets (3/2/15)
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"GUYĺs Aurora gold project is expected to begin production by mid-2015."

— Andrew Kaip, BMO Capital Markets (2/25/15)
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"MND continues to be focused on growth of sustainable cash margins."

— Andrew Kaip, BMO Capital Markets (2/25/15)
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"At MAG's Juanicipio, decline sinking continues to advance at 4m/day."

— Andrew Kaip, BMO Capital Markets (2/25/15)
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"SLW has $230M cash on hand and strong projected cash flow."

— Andrew Kaip, BMO Capital Markets (2/24/15)
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"Ramp advancement at MAG's Juanicipio appears to be progressing."

— Andrew Kaip, BMO Capital Markets (2/20/15)
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"BCM highlighted a possible ~$125M capex reduction at Corani."

— Andrew Kaip, BMO Capital Markets (2/19/15)
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"MND projects a further $7M in exploration for 2015."

— Andrew Kaip, BMO Capital Markets (2/17/15)
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"TMM identified three subparallel veins in the south wall of the pit."

— Andrew Kaip, BMO Capital Markets (2/12/15)
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"TMM encountered near-surface gold mineralization in two areas."

— Andrew Kaip, BMO Capital Markets (2/5/15)
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"TMM looks to be preserving its treasury to develop Caballo Blanco."

— Andrew Kaip, BMO Capital Markets (2/3/15)
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"TMM produced 121.6 Koz Au eq over 2014, in line with its guidance."

— Andrew Kaip, BMO Capital Markets (1/26/15)
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"THO's 2014 production of 20.3 Moz silver was at the upper end of the guidance range."

— Andrew Kaip, BMO Capital Markets (1/20/15)
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"We view AR's planned drill program at Magino positively."

— Andrew Kaip, BMO Capital Markets (1/12/15)
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"MND's Q4/14 gold equivalent production was ~10% above our forecast."

— Andrew Kaip, BMO Capital Markets (1/12/15)
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"SLW remains our preferred senior silver stock, with free cash flow even at low silver prices."

— Andrew Kaip, BMO Capital Markets (1/11/15)
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"AR's Q4/14 and full year production numbers came in well above our estimates."

— Andrew Kaip, BMO Capital Markets (1/7/15)
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"We currently model start-up of the Pascua-Lama silver stream in H2/18."

— Andrew Kaip, BMO Capital Markets (1/5/15)
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"Closing the Caballo Blanco transaction enables TMM to begin engaging on the permitting front."

— Andrew Kaip, BMO Capital Markets (12/24/14)
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"AR has grown through acquisition and will likely do so again."

The Gold Report Interview with Andrew Kaip (12/22/14)
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"FNV is a leader of our industry."

The Gold Report Interview with Andrew Kaip (12/22/14)
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"One of the names we expect to lead future consolidation of the sector is P."

The Gold Report Interview with Andrew Kaip (12/22/14)
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"Investors are gravitating toward seniors with coherent strategies like G."

The Gold Report Interview with Andrew Kaip (12/22/14)
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"GUY is going to be an acquisition target."

The Gold Report Interview with Andrew Kaip (12/22/14)
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"SLW is in the 'flight to quality' group because it is a naturally defensive name."

The Gold Report Interview with Andrew Kaip (12/22/14)
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"THO has a strong management team, high-quality assets and significant management ownership of the company."

The Gold Report Interview with Andrew Kaip (12/22/14)
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"TMM plans to acquire Caballo Blanco for $15M in cash and 16M shares."

— Andrew Kaip, BMO Capital Markets (12/18/14)
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"FVI's San Jose expansion reflects a low-risk source of production growth."

— Andrew Kaip, BMO Capital Markets (12/17/14)
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"THO is in the process of increasing Escobal's capacity to 4.5 Ktpd."

— Andrew Kaip, BMO Capital Markets (12/12/14)
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"Delivery of the SAG mill shells is a key milestone for GUY."

— Andrew Kaip, BMO Capital Markets (12/12/14)
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"PRB's acquisition gives it ownership of mineral rights in and around the Borden deposit."

— Andrew Kaip, BMO Capital Markets (12/11/14)
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"SLW's Constancia continues to be on target for first production in Q4/14."

— Andrew Kaip, BMO Capital Markets (11/12/14)
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"THO announced the inauguration of a $0.02/share monthly dividend."

— Andrew Kaip, BMO Capital Markets (11/11/14)
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"FVI generated positive free cash flow in Q3/14 and is well capitalized."

— Andrew Kaip, BMO Capital Markets (11/10/14)
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"AR expects completion of a PEA on San Agustin by year-end."

— Andrew Kaip, BMO Capital Markets (11/6/14)
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"MND's unit costs are trending downward at Cerro Bayo and Costerfield."

— Andrew Kaip, BMO Capital Markets (11/6/14)
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"THO has made significant inroads to ramp-up to full production levels by year-end 2015."

— Andrew Kaip, BMO Capital Markets (11/5/14)
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"TMM's Q3/14 EPS was above our estimate and in line with consensus."

— Andrew Kaip, BMO Capital Markets (10/28/14)
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"GUY's project finance facility will support commissioning Aurora by mid-2015."

— Andrew Kaip, BMO Capital Markets (10/20/14)
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"TMM should be able to meet the upper end of full-year production guidance."

— Andrew Kaip, BMO Capital Markets (10/17/14)
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"Grades at AR's La Colorada moved to 0.7 g/t from 0.53 g/t gold."

— Andrew Kaip, BMO Capital Markets (10/15/14)
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"MND's Q3/14 production numbers were a solid beat compared to our expectations."

— Andrew Kaip, BMO Capital Markets (10/14/14)
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"GUY remains fully funded to move Aurora through to commissioning in H2/15."

— Andrew Kaip, BMO Capital Markets (10/5/14)
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"FVI's 2P reserves at San Jose are 31.2 Moz silver and 242.6 Koz gold."

— Andrew Kaip, BMO Capital Markets (9/30/14)
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