In a report released today, Heiko Ihle from H.C. Wainwright reiterated a Buy rating on First Majestic Silver (AG – Research Report), with a price target of $12.00.
Heiko Ihle’s Buy rating for First Majestic Silver’s stock derives from a number of considerations.
Firstly, despite recording a decrease in year-over-year revenue for 3Q23 due to a suspension of production at the Jerritt Canyon project, the firm demonstrated meaningful improvements in unit costs. The company was able to significantly reduce its mine operating costs, which helped offset the decrease in revenue. Additionally, First Majestic managed to decrease its all-in sustaining cost (AISC) per silver equivalent ounce by 8% quarter over quarter, primarily due to a reduction in cash costs and a decrease in general and administrative expenses. These reductions were a result of a decrease in the company’s headcount across various departments.
Looking forward, Ihle sees potential for further cost-reduction initiatives that will improve efficiencies. Moreover, he anticipates that the company’s continued progress at the Jerritt Canyon project, including ongoing surface mapping, sampling, seismic surveying, and permitting, will provide a positive catalyst in the near term. Ihle also notes that the company’s valuation, based on a 1.8x NAV multiple, is in line with other firms in the sector and fairly accounts for recent transaction multiples in the precious metals space. These factors contribute to Ihle’s reiteration of a Buy rating and a price target of $12 for First Majestic Silver.
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First Majestic Silver (AG) Company Description:
First Majestic Silver Corp. engages in the production, development, exploration and acquisition of mineral properties. It owns and operates producing mines in México including La Encantada Silver Mine; La Parrilla Silver Mine; San Martin Silver Mine; Del Toro Silver Mine; Santa Elena Silver & Gold Mine; and San Dimas Silver & Gold Mine. The company was founded by Keith Neumeyer on September 26, 1979 and is headquartered in Vancouver, Canada.
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