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On Thursday, H.C. Wainwright reaffirmed a Buy rating on shares of First Majestic Silver (NYSE:AG), with a steady price target of $11.00. Currently trading at $5.93, the stock shows significant upside potential, with analyst targets ranging from $6.00 to $11.00. According to InvestingPro analysis, the company's Financial Health Score stands at "FAIR" with particularly strong cash flow metrics. The firm's analysts highlighted the company's production surge, with a 49% year-over-year increase in Silver Equivalent Ounces (SEOs) for the quarter. The production boost was attributed to 7.7 million SEOs, including 3.7 million ounces of silver, marking an 88% rise from the previous year, and 36,469 ounces of gold, a modest 1% year-over-year increase. This operational improvement comes as InvestingPro data shows analysts expect significant sales growth this year, with revenue forecast to grow by 62%.
The substantial growth in revenue for First Majestic Silver was primarily driven by the company's recent acquisition of a 70% stake in the Cerro Los Gatos mine. The analysts noted that not only did this new asset contribute significantly, but First Majestic's entire portfolio of mines, including Santa Elena, San Dimas, and La Encantada, also experienced increases in production compared to the previous year.
The report further detailed operational improvements at the San Dimas mine, which led to an 11% year-over-year rise in production. The company's aggressive drilling strategy was also underlined, with 28 active drill rigs distributed across its assets. Of these, seven were allocated to Cerro Los Gatos, seven to Santa Elena, 13 to San Dimas, and one to La Encantada.
The analysts concluded by expressing confidence in First Majestic Silver's operational efficiencies and the smooth integration of the Cerro Los Gatos Mine into its portfolio. They believe these factors have set the company on track for a significant year in 2025. While currently not profitable, InvestingPro analysis indicates the company is expected to turn profitable this year, with analysts forecasting positive earnings per share of $0.28 for 2025. The reiterated Buy rating and $11 price target reflect the firm's positive outlook on the company's prospects. For deeper insights into First Majestic Silver's valuation and growth potential, discover 8 additional exclusive ProTips available on InvestingPro.
In other recent news, First Majestic Silver Corp reported its Q4 2024 earnings, revealing an earnings per share (EPS) of $0.03, which fell short of the expected $0.0556. However, the company's revenue exceeded expectations, reaching $172.3 million against a forecast of $165.05 million. This strong revenue performance indicates robust sales and operational efficiency. In another development, First Majestic appointed Daniel Muñiz Quintanilla to its Board of Directors, bringing his extensive experience in international law and finance to the company. Additionally, Goldman Sachs has upgraded its gold price forecast, which has positively impacted gold mining stocks, including First Majestic Silver. The revised forecast reflects stronger-than-expected ETF inflows and sustained central bank demand. The company also reported record cash flow of $68 million for Q4 2024, contributing to positive market sentiment. Investors reacted favorably to these developments, reflecting confidence in First Majestic's strategic direction and operational achievements.
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