Sierra Madre Gold & Silver Ltd. (SM) AI Stock Analysis

• Market Cap: C$276.11M
• Dividend Yield: N/A
• Average Volume (3M): 406.41K
• Price to Earnings (P/E): 329.3
• Beta (1Y): 1.53
• Revenue Growth: 694.29%
• EPS Growth: N/A
• Country: CA
• Employees: N/A
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Other Precious Metals
• EPS (TTM): 0.00
• Shares Outstanding: 144,560,730
• 10 Day Avg. Volume: 526,510
• 30 Day Avg. Volume: 406,407
• PEG Ratio: 0.14
• Price to Book (P/B): 2.00
• Price to Sales (P/S): 11.06
• P/FCF Ratio: -13.02
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 65 Neutral
• Price Target: C$2.00 ▲(11.73% Upside)

The score is driven primarily by improving financial performance (return to profitability and manageable leverage), supported by strong technical trend/momentum. These positives are tempered by weak cash conversion (negative free cash flow) and a very high P/E that makes valuation a notable risk, despite favorable corporate developments around expansion and exploration.

Positive Factors

Operational Expansion

The early start of operations at the Coloso mine enhances production capabilities and operational efficiency, strengthening Sierra Madre's market position in the precious metals sector.

Full Production Achievement

Achieving full production at the Guitarra Mine demonstrates operational success and economic viability, positioning the company for sustained revenue growth in the gold and silver markets.

Strategic Partnerships

The off-take agreement with MRI Trading AG ensures a stable revenue stream and enhances market access, supporting Sierra Madre's long-term growth strategy in the precious metals industry.

Negative Factors

Profitability Challenges

Persistent profitability challenges with negative net income highlight operational inefficiencies and cost management issues, potentially impacting long-term financial health.

Cash Flow Concerns

Negative cash flows indicate liquidity issues and the need for improved cash management, which could constrain Sierra Madre's ability to finance future growth and operations.

High Operational Costs

High operational costs relative to revenue hinder profitability, necessitating cost optimization to ensure sustainable financial performance and competitiveness in the mining sector.

Sierra Madre Gold & Silver Ltd. Business Overview & Revenue Model

Company Description

Sierra Madre Gold and Silver Ltd., a mineral exploration company, engages in the acquisition, exploration, and development of resource properties. It holds an interest in the Tepic silver-gold property comprising five mining concessions covering an area of 2,612.5 hectares located to the south-southeast from the city of Tepic, Nayarit; and the La Tigra gold-silver property that consists of seven mining concessions covering an area of 357 hectares located in the State of Nayarit, Mexico. The company is based in West Vancouver, Canada.

How the Company Makes Money

Sierra Madre Gold & Silver Ltd. generates revenue primarily through the exploration, development, and eventual production of precious metals such as gold and silver from its mining operations. The company's revenue model involves identifying and acquiring promising mineral properties, conducting detailed exploration and feasibility studies, and developing these assets into productive mines. Once operational, the company sells the extracted metals on the commodities market. Key revenue streams include the direct sale of gold and silver, as well as potential joint ventures and strategic partnerships with other mining entities that provide additional funding or resources to expedite project development. Market prices for gold and silver, as well as operational efficiency and successful project management, significantly impact the company's earnings.

Sierra Madre Gold & Silver Ltd. Financial Statement Overview

Summary

Sierra Madre Gold & Silver Ltd. is experiencing a transition towards revenue generation with $8.87 million in revenue for 2024, but is not yet profitable with a negative net income of $5.58 million. The company has a conservative capital structure with a debt-to-equity ratio of 0.22, but its negative operating cash flow indicates potential liquidity issues.

Income Statement

Sierra Madre Gold & Silver Ltd. has shown an improvement in revenue with $8.87 million in 2024, a first since the last five years, indicating growth potential. However, profitability remains a significant concern with a negative net income of $5.58 million in 2024 and negative EBIT and EBITDA margins. The company is yet to achieve a positive net profit margin, reflective of high operational costs relative to revenue.

Balance Sheet

The balance sheet shows a moderate level of total debt at $7.74 million against a substantial stockholder's equity of $35.89 million, yielding a debt-to-equity ratio of 0.22, which is relatively low and indicates a conservative capital structure. However, the equity ratio stands at 71.53%, reflecting a strong equity base but also highlighting a reliance on equity financing. The return on equity is negative due to persistent net losses.

Cash Flow

Cash flow analysis shows a negative operating cash flow of $5.11 million and a significant negative free cash flow of $9.35 million in 2024, due to high capital expenditures. The company’s operating cash flow to net income ratio is improving, but still negative. Continued cash outflows highlight potential liquidity issues and a need for effective cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	16.67M	6.47M	0.00	0.00	0.00	0.00
Gross Profit	3.88M	1.36M	-17.72K	-12.95K	-2.30K	0.00
EBITDA	1.93M	-3.34M	-53.51M	-4.48M	-7.11M	-1.08M
Net Income	-372.99K	-5.58M	-40.00M	-2.56M	-7.11M	-1.20M
Balance Sheet
Total Assets	37.71M	50.18M	30.48M	28.11M	10.93M	15.80M
Cash, Cash Equivalents and Short-Term Investments	710.48K	650.18K	1.93M	88.24K	10.21M	15.28M
Total Debt	5.38M	7.74M	15.26K	0.00	0.00	0.00
Total Liabilities	11.49M	14.29M	3.78M	12.42M	141.87K	524.07K
Stockholders Equity	26.23M	35.89M	26.70M	15.68M	10.79M	15.27M
Cash Flow
Free Cash Flow	-1.20M	-5.50M	-7.24M	-2.07M	-4.71M	-1.33M
Operating Cash Flow	439.21K	-3.73M	-5.34M	-2.01M	-4.70M	-1.33M
Investing Cash Flow	-2.20M	-5.20M	-1.07M	-397.20K	-23.01K	34.59K
Financing Cash Flow	822.62K	8.31M	8.01M	2.48M	-351.59K	16.54M

Sierra Madre Gold & Silver Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.79
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:SM, the sentiment is Positive. The current price of 1.79 is above the 20-day moving average (MA) of 1.66, above the 50-day MA of 1.38, and above the 200-day MA of 0.97, indicating a bullish trend. The MACD of 0.14 indicates Negative momentum. The RSI at 64.91 is Neutral, neither overbought nor oversold. The STOCH value of 72.38 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:SM.

Sierra Madre Gold & Silver Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EMPR	67 Neutral	C$129.95M	26.41	17.02%	―	112.93%	―
SM	65 Neutral	C$276.11M	329.31	2.04%	―	694.29%	―
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
SSV	61 Neutral	C$305.02M	-32.50	-19.63%	―	―	-34.83%
CKG	56 Neutral	C$303.80M	-85.10	-2.40%	―	―	14.96%
VML	56 Neutral	C$106.06M	-65.28	―	―	―	-85.26%
DEF	53 Neutral	C$96.47M	-37.32	-4.10%	―	―	43.20%

Sierra Madre Gold & Silver Ltd. Corporate Events

Sierra Madre Reports Strong Q3 2025 Results and Expansion Plans

Sierra Madre Gold & Silver Ltd. reported solid financial results for Q3 2025, with revenues of $5.5 million and a gross profit of $1.7 million, driven by stronger silver and gold prices. The company is expanding its La Guitarra plant and has initiated a $3.5 million exploration program in the East District. Despite challenges from power outages due to a heavy rainy season, Sierra Madre anticipates improved performance in Q4 and plans to implement a backup power system by 2026. The company also closed a C$19.5 million private placement to support its expansion and development efforts.

Sierra Madre Launches $3.5 Million Exploration in Mexico’s Guitarra Project

Sierra Madre Gold & Silver Ltd. has initiated a US$3.5 million exploration program at the East District of the Guitarra project in Mexico, targeting the under-explored Temascaltepec mining area. This program aims to unlock additional resources through detailed geological mapping and a significant drilling initiative, potentially enhancing the company’s resource base and market position. The exploration is funded by the company’s treasury and recent private placement, indicating a strategic investment in expanding their operational footprint and resource potential.