Picture supply: Getty Pictures
Investing in high quality mining shares gives portfolio diversification and publicity to the commodity sector. One prime TSX mining inventory is First Majestic Silver (TSX:AG), valued at a market cap of $5.5 billion.
First Majestic Silver inventory has returned 34% within the final 12 months and has virtually doubled investor returns over the previous decade. Let’s see if this TSX inventory stays a superb funding proper now.
Is that this TSX mining inventory a superb purchase?
First Majestic Silver is engaged within the acquisition, exploration, improvement, and manufacturing of mineral properties. Through the years, First Majestic Silver has targeted on robust operational momentum, positioning itself as a key participant amongst silver miners.
The silver miner ended Q1 2025 with a document money place of US$462.6 million and US$544 million in whole liquidity. A powerful steadiness sheet supplies First Majestic Silver with the flexibleness for progress investments and operational optimization.
It reported document gross sales of US$244 million in Q1 and an working money circulate of US$110 million, showcasing a capability to generate significant returns from its mining operations.
File silver manufacturing
Operationally, First Majestic achieved document silver manufacturing of three.7 million ounces in Q1, with enhancing price metrics displaying money prices declining to US$13.68 per ounce. In 2025, it estimates silver manufacturing between 13.6 million ounces and 15.3 million ounces, representing 71% progress on the midpoint in comparison with 2024 ranges.
The January 2025 acquisition of a 70% stake in Cerro Los Gatos enhances the corporate’s manufacturing profile, including a low-cost underground operation with strong exploration potential.
Mixed with current property together with Santa Elena, San Dimas, and La Encantada mines in Mexico, First Majestic controls over 350,000 hectares throughout three world-class silver mining districts.
The bull case for the TSX inventory
First Majestic Silver advantages from compelling silver market fundamentals that underscore the steel’s vital significance and provide constraints. The distinctive properties of silver make substitution practically unimaginable, given its standing as essentially the most electrically conductive steel.
The silver market faces a structural imbalance, with annual consumption reaching 1.2 billion ounces whereas mine manufacturing delivers solely 835 million ounces. This supply-demand mismatch has created 5 consecutive years of market deficits, together with an estimated 150-million-ounce shortfall in 2024 and a projected 120-million-ounce deficit for 2025.
Hovering demand
Industrial demand has elevated by 33% since 2020, reaching 681 million ounces by 2024. Furthermore, photovoltaic photo voltaic functions characterize a dynamic progress phase, with silver demand reaching 198 million ounces in 2024, a 140% improve since 2020. This PV demand now accounts for 25% of whole world mined silver manufacturing.
The present silver provide combine depends on mining for 81% and recycling for 19%, but new mine provide stays restricted whereas industrial functions proceed to increase.
With electrical and electronics demand totalling 461 million ounces in 2024, a 31% improve since 2020, the structural deficit seems prone to persist, making a beneficial surroundings for silver producers like First Majestic.
The miner’s vertical integration technique by First Mint, its Nevada-based bullion facility, creates extra worth seize alternatives by eliminating middlemen and capitalizing on robust bodily silver funding demand.
With enhancing ESG scores and a dividend coverage tied to income efficiency, First Majestic positions itself as a complete silver funding car for traders searching for publicity to the dear metals sector.
Analysts count on adjusted earnings for the TSX inventory to increase from US$0.08 per share in 2025 to US$0.39 per share in 2027. If First Majestic inventory is priced at 30 instances ahead earnings, it is going to commerce round US$12 in early 2027, indicating an upside potential of over 40% from present ranges.
