Credit Suisse kept a Neutral rating and $31 target price on Silver Standard Resources Inc. (SSO.TO) based on its Q4 result.

Event: “SSO reported an adjusted 4Q10 loss of $0.15/share versus consensus EPS of $0.11. Adjusted 4Q10 results exclude a $4.87 gain-on-sale of Snowfield/Brucejack. SSO remains in the de-bottlenecking and optimization stage at its Pirquitas mine, so we don’t consider earnings as relevant at this stage in the story. Silver production of 2.1Moz was in-line with expectations, while sales of 1.6Moz (78% of production) was lower than expected ($0.10 impact) and cash costs higher on increased refining charges ($0.06 impact).”

Impact: “Neutral. Q4 silver production at Pirquitas was in-line as lower ore milled (313Kt vs. our 350Kt) was offset by better recoveries (76.3% vs. our 72%). Silver head grade (267g/t) continued to track above reserve grade. Pirquitas is fully feeding sulphide ore through the processing plant, which we consider an important milestone for the operation. FY11 silver production guidance is unchanged at 8.5Moz, with zinc production targeted at 10Mln lbs. In addition, tin production estimates have been excluded from guidance pending test-work to improve recoveries. Cash cost are expected to be $15/oz (net of by-products) – a higher figure than our previous forecast due to lower grades processed in 2011, higher refining charges and lower tin production.”

Catalyst: “Costs up; but still a FCF positive story in 2011. With cash of $232Mln SSO is well positioned to see Pirquitas through to sustainable design production rates. We forecast breakeven FCF in 1Q11 with SSO turning FCF positive in 2Q11, marking another positive milestone in the SSO story.”

Valuation. “Lowering EPS on higher refining charges and cost pressures. We are lowering our FY11/12 EPS to $0.39/0.56 (from $1.02/0.80) to reflect actual 4Q10 results, lower silver grades processed, higher refining charges, and lower expectations for tin production. Our TP of $31 is unchanged and based on a blended 1.3x P/NAV for Pirquitas plus in-situ resource valuation ($1.40/oz) for exploration/resource portfolio. We maintain our Neutral rating.”