First Majestic Silver (TSX:AG) Returns to Profitability, Challenging Bearish Narratives on Growth and Valuation

First Majestic Silver (TSX:AG) posted a turnaround in its financial performance, becoming profitable over the past year with margins improving alongside this shift. The company’s earnings are forecast to jump at a pace of 32.3% per year over the next three years, while revenue is projected to rise 16.3% annually. Both figures are well ahead of the Canadian market’s growth rates. Trading at CA$15.05 per share, AG sits noticeably below its independently assessed fair value estimate of CA$44.45, which points to significant valuation upside for investors looking for growth and quality.

See our full analysis for First Majestic Silver.

Next, we’ll put these headline earnings and outlook numbers head-to-head with Simply Wall St’s most-followed narratives, highlighting the themes that run with the results and those that are set to be re-examined.

See what the community is saying about First Majestic SilverTSX:AG Earnings & Revenue History as at Nov 2025

Margins Set to Climb Towards 8.0%

Analysts expect profit margins to move from 1.8% currently to 8.0% over the next three years, indicating room for operational efficiency gains if targets are met. Consensus narrative highlights:

Operational synergies from the integration of Cerro Los Gatos, combined with procurement and efficiency improvements, are expected to lower all-in sustaining costs. This is anticipated to help margins track the projected rise. Analysts warn that persistently high operating and capital expenditures, especially at key mines like San Dimas, could put upward pressure on costs. This would give less margin for error if forecasted production or silver prices do not materialize.

Share Dilution Risks Next to Growth Ambitions

The number of shares outstanding is expected to grow by 7.0% per year over the next three years, as the company funds expanded exploration and new developments. Consensus narrative notes:

While ongoing investment in large new ore bodies (such as Navidad and Santo Niño) is vital for extending reserve life and supporting growth, execution risks such as underperformance at new projects or delayed production could make dilution more costly for shareholders if results disappoint. Concentration of operations in Mexico exposes the company to region-specific risks like labor unrest and regulatory shifts. These factors could challenge both growth and the value of new shares as the business expands.

Valuation: Discount to DCF Fair Value, Peer Premium in Sight

First Majestic trades at CA$15.05, which is well below its independently assessed DCF fair value of CA$44.45, but commands a higher price-to-sales ratio than the broader Canadian metals and mining industry. According to the analysts' consensus view:

The consensus price target of CA$13.88 sits just 5.7% above the current share price, suggesting analysts see the company as fairly priced. However, the much higher DCF fair value signals a potential opportunity if ambitious growth targets are met and margin expansion is realized. Despite this, the premium to industry multiples suggests that investors are pricing in First Majestic’s stronger growth prospects and improved balance sheet. The stock will need to deliver on forecasts to justify staying above peers.

To see the full outlook that balances growth, risks, and valuation, check the consensus narrative for the story behind these numbers. 📊 Read the full First Majestic Silver Consensus Narrative.

Story Continues

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for First Majestic Silver on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

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A great starting point for your First Majestic Silver research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.

Explore Alternatives

First Majestic’s growth ambitions come with execution risks, rising costs, and share dilution. These factors could erode value if forecasts are missed.

If you want steadier performance and a smoother ride, tap into stable growth stocks screener (2074 results) and focus on companies with consistent earnings and reliability across the cycle.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include AG.TO.

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