May 27 (Bloomberg) -- Pandora A/S was the second-biggest gainer among benchmark stocks in Copenhagen today after Nordea Bank AB said declines in the price of gold and silver will lower costs at the Danish jewelry maker.
Pandora rose as much as 2.2 percent, the biggest advance in the Nasdaq OMX Copenhagen 20 Index after Vestas Wind Systems A/S. Pandora’s stock rose 1.5 percent to 203 kroner at 9:41 a.m. in the Danish capital with trading volume at 16 percent of the three-month daily average.
Gold price futures have dropped 5.3 percent this month, adding to April’s 7.8 percent decline, as some investors lose faith in the metal as a store of value amid an improving U.S. economy and a rally in equities. Silver spot prices have plunged about 19 percent since April 9.
“Silver and gold are by far the most important raw materials in Pandora’s production of jewelry,” Nordea said today in a note to clients. “With the current development, Pandora will be able to look forward to significant future cost savings.”
Pandora’s shares jumped 12 percent on May 14 when the Glostrup, Denmark-based company reported first-quarter profit that beat analyst estimates. Eight days later, the stock dropped 11 percent as its majority shareholder, Prometheus Invest ApS, sold 13 million shares to institutional investors for about 2.6 billion kroner ($450 million).
“We see the recent share price decline in Pandora as a good opportunity to buy because the first-quarter earnings report confirmed that the growth story is back,” Nordea said.
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