First Majestic Silver Acquires Gatos Silver for $970 Million
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 5d ago
0mins
Should l Buy AG?
Source: Fool
- Acquisition Deal: First Majestic Silver's $970 million acquisition of Gatos Silver grants it a 70% stake in the Los Gatos Joint Venture, significantly enhancing its silver production capacity in Mexico and positioning it as a larger-scale silver producer.
- Production Performance: In Q4 2024, First Majestic produced 4.2 million ounces of silver, a 77% year-over-year increase, with the Los Gatos mine contributing 1.5 million ounces, driving the annual total to a record 15.4 million ounces, an 84% increase.
- Financial Results: In Q3, First Majestic achieved record quarterly revenues of $285.1 million, a 95% increase from the previous year, with operating cash flow rising to $141.3 million and free cash flow reaching $98.8 million, resulting in a record cash position of $568.9 million, indicating robust financial health.
- Shareholder Returns: The company plans to increase its dividend from 1% to 2% of net quarterly revenue starting in 2026, and if silver prices remain high, it is expected to provide significantly higher returns to shareholders, further boosting investor confidence.
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Analyst Views on AG
Wall Street analysts forecast AG stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for AG is 15.06 USD with a low forecast of 12.50 USD and a high forecast of 17.50 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
4 Analyst Rating
1 Buy
3 Hold
0 Sell
Hold
Current: 20.250
Low
12.50
Averages
15.06
High
17.50
Current: 20.250
Low
12.50
Averages
15.06
High
17.50
About AG
First Majestic Silver Corp. is a mining company. The Company is focused on silver and gold production in Mexico and the United States. It owns and operates approximately 350,000 hectares of land package, which include the San Dimas Silver/Gold Mine, the Santa Elena Silver/Gold Mine, the La Encantada Silver Mine, and a 70% joint venture interest in the Cerro Los Gatos Silver Mine as well as a portfolio of development and exploration assets, including the Jerritt Canyon Gold project located in northeastern Nevada, United States. The San Dimas Silver/Gold Mine is located over 130 kilometers (km) northwest of the city of Durango, Durango State, Mexico. The Santa Elena Silver/Gold Mine is located over 150 km northeast of the city of Hermosillo, Sonora, Mexico. The La Encantada Silver Mine is an underground mine located in the northern Mexico State of Coahuila, 708 km northeast of Torreon. The Cerro Los Gatos Mine is located around 120 kms south of Chihuahua City, Mexico.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Market Volatility Analysis: Following a plunge of 10% in gold and 30% in silver prices around January 30, a rebound has occurred, highlighting the fragility of the commodities market, where investor reactions to tightening liquidity have exacerbated trading volatility.
- Investor Confidence Recovery: Despite recent price fluctuations, market experts assert that the fundamentals for gold and silver have not deteriorated; rather, a rapid shift in leverage usage and geopolitical tensions have led to panic selling among traders.
- Buying Opportunity for Gold and Silver: Market consensus suggests that now is a good time to buy gold and silver on the dip, particularly for companies like Agnico Eagle Mines and First Majestic Silver, which are expected to see significant dividend and earnings growth supported by analysts.
- ETF Investment Opportunities: For risk-averse investors, gold and silver ETFs offer a relatively simple and low-risk way to invest, making them an ideal choice for those looking to capitalize on rising metal prices while diversifying their risk and potential returns.
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- Gold Price Decline: Spot gold fell over 1% to $4,899.8 per ounce, reflecting market uncertainty about future trends, which may lead investors to reassess their asset allocation strategies.
- Silver Futures Surge: March 2026 silver futures rose approximately 62% to $85.1 per ounce, indicating strong market demand for silver, particularly after price corrections that attracted significant speculative capital.
- Zhongcai Futures Profitability: According to the Financial Times, Zhongcai Futures earned over $500 million during the silver rout, demonstrating its successful establishment of large short positions amidst market volatility, thereby solidifying its position in the industry.
- Market Sentiment Shift: Despite declines in silver mining stocks like First Majestic and Hecla Mining by over 2%, retail sentiment for iShares Silver Trust and SPDR Gold Shares ETF remains in the 'extremely bullish' territory, indicating strong investor confidence in future market performance.
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First Majestic Silver Acquires Gatos Silver for $970 Million
- Acquisition Deal: First Majestic Silver's $970 million acquisition of Gatos Silver grants it a 70% stake in the Los Gatos Joint Venture, significantly enhancing its silver production capacity in Mexico and positioning it as a larger-scale silver producer.
- Production Performance: In Q4 2024, First Majestic produced 4.2 million ounces of silver, a 77% year-over-year increase, with the Los Gatos mine contributing 1.5 million ounces, driving the annual total to a record 15.4 million ounces, an 84% increase.
- Financial Results: In Q3, First Majestic achieved record quarterly revenues of $285.1 million, a 95% increase from the previous year, with operating cash flow rising to $141.3 million and free cash flow reaching $98.8 million, resulting in a record cash position of $568.9 million, indicating robust financial health.
- Shareholder Returns: The company plans to increase its dividend from 1% to 2% of net quarterly revenue starting in 2026, and if silver prices remain high, it is expected to provide significantly higher returns to shareholders, further boosting investor confidence.
See More
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- Silver Futures Surge: March 2026 silver futures jumped 12.8% to $86.8 per ounce, reflecting a reassessment of prices by investors, with potential for silver to reach $300 by summer 2026.
- Market Sentiment Reset: Analyst Peter Fertig noted that the market was oversold following Trump's nomination of a new Fed chair, and the current rebound is attracting profit-taking investors back into the market, highlighting strong demand for precious metals.
- Mining Stocks Rise: The rebound in precious metal prices lifted shares of silver miners like First Majestic and Hecla Mining by around 5%, while gold miners Newmont and Barrick Gold saw increases of 4% and 5%, respectively, indicating optimistic sentiment towards mining stocks.
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- Silver Futures Rise: Although spot silver prices plummeted over 26% on Friday, March 2026 silver futures gained 2.7% to $80.6 per ounce, suggesting persistent demand for silver that may attract investors back into the market.
- Dollar Index Rises: The U.S. Dollar Index (DXY) increased by 0.1% to 97.3 in pre-market trading, indicating the dollar's strength is exerting pressure on the precious metals market, prompting investors to reassess their asset allocations.
- ETF Performance Declines: The iShares Silver Trust (SLV) slid to its lowest level since January 9 in pre-market trading, with Friday's sell-off wiping out its year-to-date gains from around 80% to approximately 30%, reflecting a dramatic shift in market sentiment.
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- Hecla Mining Decline: Hecla Mining Company experienced a 33.33% decrease this week, as President Trump's nomination of Kevin Warsh for Fed Chair strengthened the dollar, reducing demand for safe-haven assets and negatively impacting precious metal stocks.
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- First Majestic Silver Drop: First Majestic Silver Corp. decreased by 22.86% this week amid a broader weakness in the precious metals market, leading to investor unease regarding the company's outlook and potentially affecting its financing and expansion plans.
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Analysis of Gold and Silver Price Rebound
- Market Volatility Analysis: Following a plunge of 10% in gold and 30% in silver prices around January 30, a rebound has occurred, highlighting the fragility of the commodities market, where investor reactions to tightening liquidity have exacerbated trading volatility.
- Investor Confidence Recovery: Despite recent price fluctuations, market experts assert that the fundamentals for gold and silver have not deteriorated; rather, a rapid shift in leverage usage and geopolitical tensions have led to panic selling among traders.
- Buying Opportunity for Gold and Silver: Market consensus suggests that now is a good time to buy gold and silver on the dip, particularly for companies like Agnico Eagle Mines and First Majestic Silver, which are expected to see significant dividend and earnings growth supported by analysts.
- ETF Investment Opportunities: For risk-averse investors, gold and silver ETFs offer a relatively simple and low-risk way to invest, making them an ideal choice for those looking to capitalize on rising metal prices while diversifying their risk and potential returns.
See More
Analysis of Volatility in Gold and Silver Markets
- Gold Price Decline: Spot gold fell over 1% to $4,899.8 per ounce, reflecting market uncertainty about future trends, which may lead investors to reassess their asset allocation strategies.
- Silver Futures Surge: March 2026 silver futures rose approximately 62% to $85.1 per ounce, indicating strong market demand for silver, particularly after price corrections that attracted significant speculative capital.
- Zhongcai Futures Profitability: According to the Financial Times, Zhongcai Futures earned over $500 million during the silver rout, demonstrating its successful establishment of large short positions amidst market volatility, thereby solidifying its position in the industry.
- Market Sentiment Shift: Despite declines in silver mining stocks like First Majestic and Hecla Mining by over 2%, retail sentiment for iShares Silver Trust and SPDR Gold Shares ETF remains in the 'extremely bullish' territory, indicating strong investor confidence in future market performance.
See More
First Majestic Silver Acquires Gatos Silver for $970 Million
- Acquisition Deal: First Majestic Silver's $970 million acquisition of Gatos Silver grants it a 70% stake in the Los Gatos Joint Venture, significantly enhancing its silver production capacity in Mexico and positioning it as a larger-scale silver producer.
- Production Performance: In Q4 2024, First Majestic produced 4.2 million ounces of silver, a 77% year-over-year increase, with the Los Gatos mine contributing 1.5 million ounces, driving the annual total to a record 15.4 million ounces, an 84% increase.
- Financial Results: In Q3, First Majestic achieved record quarterly revenues of $285.1 million, a 95% increase from the previous year, with operating cash flow rising to $141.3 million and free cash flow reaching $98.8 million, resulting in a record cash position of $568.9 million, indicating robust financial health.
- Shareholder Returns: The company plans to increase its dividend from 1% to 2% of net quarterly revenue starting in 2026, and if silver prices remain high, it is expected to provide significantly higher returns to shareholders, further boosting investor confidence.
See More
Gold and Silver Futures Prices Surge After Selloff
- Gold Futures Rebound: March 2026 gold futures surged 5.9% to $4,912 per ounce, indicating a recovery in market sentiment after a three-day decline, with expectations of further increases to $7,500 in the future.
- Silver Futures Surge: March 2026 silver futures jumped 12.8% to $86.8 per ounce, reflecting a reassessment of prices by investors, with potential for silver to reach $300 by summer 2026.
- Market Sentiment Reset: Analyst Peter Fertig noted that the market was oversold following Trump's nomination of a new Fed chair, and the current rebound is attracting profit-taking investors back into the market, highlighting strong demand for precious metals.
- Mining Stocks Rise: The rebound in precious metal prices lifted shares of silver miners like First Majestic and Hecla Mining by around 5%, while gold miners Newmont and Barrick Gold saw increases of 4% and 5%, respectively, indicating optimistic sentiment towards mining stocks.
See More
Gold Futures Drop While Silver Futures Rise Amid Market Volatility
- Gold Futures Decline: March 2026 gold futures fell 1% to $4,717 per ounce, reflecting increasing selling pressure in the precious metals market, despite JPMorgan's forecast of gold prices reaching $6,300 by year-end, indicating potential future demand.
- Silver Futures Rise: Although spot silver prices plummeted over 26% on Friday, March 2026 silver futures gained 2.7% to $80.6 per ounce, suggesting persistent demand for silver that may attract investors back into the market.
- Dollar Index Rises: The U.S. Dollar Index (DXY) increased by 0.1% to 97.3 in pre-market trading, indicating the dollar's strength is exerting pressure on the precious metals market, prompting investors to reassess their asset allocations.
- ETF Performance Declines: The iShares Silver Trust (SLV) slid to its lowest level since January 9 in pre-market trading, with Friday's sell-off wiping out its year-to-date gains from around 80% to approximately 30%, reflecting a dramatic shift in market sentiment.
See More
Ten Large-Cap Stocks with Worst Performance Last Week
- Unity Software Plunge: Unity Software Inc. saw a 31.63% drop this week, primarily due to CEO Matthew Bromberg's social media post about the company and 'world models', raising concerns about its future and potentially undermining investor confidence.
- Hecla Mining Decline: Hecla Mining Company experienced a 33.33% decrease this week, as President Trump's nomination of Kevin Warsh for Fed Chair strengthened the dollar, reducing demand for safe-haven assets and negatively impacting precious metal stocks.
- UnitedHealth Target Cuts: UnitedHealth Group Incorporated fell 17.87% this week after multiple analyst firms lowered their price targets, reflecting market concerns over its future profitability and prompting investors to reassess their holdings.
- First Majestic Silver Drop: First Majestic Silver Corp. decreased by 22.86% this week amid a broader weakness in the precious metals market, leading to investor unease regarding the company's outlook and potentially affecting its financing and expansion plans.
See More
