First Majestic Silver, the Basic Materials sector company, was revisited by a Wall Street analyst today. Analyst Heiko Ihle from H.C. Wainwright reiterated a Buy rating on the stock and has a $12.75 price target.
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Heiko Ihle has given his Buy rating due to a combination of factors including First Majestic Silver’s impressive financial performance and strategic acquisitions. The company reported significant revenue growth of 94% year-over-year, largely driven by the acquisition of Gatos Silver, which also contributed to a 42% increase in silver equivalent ounce sales and a 24% rise in the average realized silver price. This growth in revenue has translated into a substantial increase in operating cash flow, showcasing the effectiveness of the company’s aggressive M&A strategy.
Additionally, First Majestic Silver’s strong balance sheet, with a cash position of $384.8 million and a total treasury balance of $510.1 million, provides considerable liquidity for potential future acquisitions. The company’s ability to maintain a robust cash position and its strategic investments in assets like the Cerro Los Gatos Mine are expected to further enhance its production capabilities and cash flow. Ihle’s valuation of the company, based on discounted cash flow models and a low discount rate, aligns with the industry standards and reflects confidence in the firm’s future production and financial stability.
In another report released yesterday, TR | OpenAI – 4o also upgraded the stock to a Buy with a C$13.50 price target.