FIRST MAJESTIC SILVER CORP. (AG): what the price assumes

In the published model solve dated 2026-Q2, anchored at $17.61, FIRST MAJESTIC SILVER CORP. (AG) is priced for today's economics sustained for ~9.4 years. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-07-25.

Generated: 2026-08-10 · Exported: 2026-08-11 · Source: https://boothcheck.com/report/AG

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

The operating-margin figure is value-band context at year 6: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

Solve inputs: computed at a 12.9% cost of capital; growth searched up to the 25% self-funding ceiling; each 1pp moves the implied horizon ~1.9 years.

Reconcile: at the x-ray's 9.3% required return this reads ~17.4%/yr; the models below use their own rates.

How unusual the bet is: elevated (limited comparison data)

Valuation X-Ray

Every valuation family lands below the price. The price therefore sits beyond what those standard frames encode.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Families that call it expensive: Asset, Earnings, Relative

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.4%); the inversion above states its own rate.

Per-Model Detail (n=8)

Solvency

Bullet Takeaways

• First Majestic runs four producing underground mines in Mexico alongside its share of Los Gatos, and in July it lifted its 2026 silver target by 10% to 14.6 to 15.5 million ounces after second quarter output of 3.8 million ounces.
• The economics rest on a wide but unstable spread: 2026 all-in sustaining costs are guided at $27.69 to $28.77 per payable silver equivalent ounce against a planning assumption of $52 silver.
• Growth has been paid for in shares rather than cash, with the count rising about 18.3% a year over four years, which makes ounces per share the number that matters rather than ounces.

Bull Case

A silver miner is not really an industrial company and it does not behave like one. What a shareholder owns is a claim on a fixed quantity of metal that has already been found, extracted at a cost the company controls and sold at a price it does not. Book value records what the mines cost to build years ago. Trailing profit records what the metal fetched during a particular twelve months. Neither describes the thing being bought, which is a spread: 2026 all-in sustaining costs guided at $27.69 to $28.77 per payable silver equivalent ounce, against a metal that the company's own plan assumes sells at $52. Every dollar the silver price moves above that cost falls almost entirely to the bottom line, and every dollar it moves below does the reverse. That asymmetry is the investment.

Right now the spread is unusually wide, and the operations have been getting better underneath it. Second quarter silver production reached 3.8 million ounces against 3.7 million a year earlier, driven by La Encantada and Santa Elena, and gold production rose to 34,660 ounces from 33,865. More importantly, the company raised its full-year outlook rather than trimming it, taking 2026 attributable silver guidance up 10% at the midpoint and gold up 7%. Mining companies revise guidance downward far more often than upward, because underground geology tends to disappoint rather than surprise. An increase mid-year, delivered while the company was also rehabilitating a rockfall on the main ramp at Los Gatos, says the rest of the portfolio is running ahead of plan.

The Los Gatos position is the piece with the most left to prove and the most to give. The mine is being pushed toward a sustained 4,000 tonnes per day in the second half of 2026, and the attributable output forecast for it was raised about 5% at the midpoint even after the April disruption. Throughput at a single underground operation is the most controllable variable in this entire business. Metal prices are set in London and Mexico City sets the peso; tonnes per day is set on site.

Financially the company is in a position to ride the cycle rather than be dictated to by it. It holds more cash and liquid assets than debt, so the balance sheet is a net contributor rather than a claim, and operating profit covers the interest bill roughly fifteen times over. Trailing revenue of about $1.26 billion converts to an operating margin near 31.6%. For comparison inside the precious metals cohort, Coeur Mining converted 38.7% of $2.57 billion, and its revenue more than doubled year over year, while Fortuna Mining managed 14.3% on a similar revenue base. The dispersion in that group is the clearest evidence that the metal price alone does not determine the result; where a company sits on the cost curve does. First Majestic sits comfortably in the middle of it, which is a better place than the discussion around this stock usually assumes.

Bear Case

The methods that value this company on what it owns and what it earns are the ones the bear should trust, and they are unanimous. Valued on its book equity and the return it generates on that equity, the price sits at roughly three and a half times what the approach supports. Valued on the cash the business currently throws off, capitalized without any growth, the price sits about two thirds above it. Peer multiples land close to half again below the price. Not one standard family of method reaches today's quote. That is a specific finding rather than a general grumble about expensive stocks: the price is a bet that lives outside what any conventional frame can encode.

What that bet requires is calculable and it is severe. At roughly nineteen times company-wide operating profit, the price assumes the company grows operating profit at about the fastest rate it can fund from its own cash flow, near 25% a year, and holds that pace for about nine years. Historically only around 17% of comparably fast-growing companies sustained such a run for that long. The sensitivity is worth carrying too: each percentage point of growth adds or removes roughly two years from the required horizon, so the assumption is far more fragile than the single headline number suggests.

Now put that next to the metal. The guidance underlying the operating plan assumes silver at $52 an ounce and gold at $3,900. All-in sustaining costs are guided near $28 per payable silver equivalent ounce. The margin is therefore wide today, and it is wide precisely because metal prices are at levels the industry has not sustained for long. Coeur Mining's revenue more than doubled year over year and Fortuna Mining's rose about 125%. Those are not operating achievements; they are the same price appearing in three different companies' income statements. Coeur's own filing is direct about the dependency, stating that as a mining company its revenue, profitability and future rate of growth are substantially dependent on the prevailing prices for gold, silver and that prices may fluctuate widely due to numerous factors, such as U.S. dollar strength or weakness, global political and economic conditions, demand, investor sentiment, inflation or deflation. A nine-year compounding assumption sitting on top of that is a category error about what kind of business this is. Peak earnings in a commodity are not sustainable earnings; they are a moment in a price series.

The dilution compounds the problem in a way headline production numbers conceal. The share count has grown about 18.3% a year over the last four years. Guidance rose 10% this July; the share base has been growing faster than that annually. A shareholder from four years ago owns a materially smaller slice of a larger company, and the growth that the price is extrapolating has been bought with equity rather than generated by the mines. When a company issues stock at high metal prices to acquire ounces valued at high metal prices, the arithmetic works only if those prices hold.

To be fair about where the risk is not: this is not a solvency story. Cash and liquid assets exceed the debt, interest is covered roughly fifteen times, and the company is not consuming cash. There is no financing cliff here and no forced-seller scenario in the near term. The bear case is entirely about price and expectation, which is the harder kind to argue and the more common way money is lost.

Valuation

Nineteen times operating profit is the number to hold onto. That is what the whole company costs against what it currently earns from operations, and working backwards from it produces a specific requirement: operating profit growing at roughly the maximum rate the business can fund internally, around 25% a year, sustained for about nine years. The comparison that matters is how often that has actually happened. Among comparably fast-growing companies, roughly 17% kept it up for that long. The calculation runs at a cost of capital near 13.2%, and each percentage point of growth shifts the required horizon by about two years in either direction.

The methods used to triangulate the value do not disagree with each other here, which is unusual and worth pausing on. Every family lands below the price. The asset-based approaches, which value the equity against its book and the return earned on it, sit furthest away, with the price more than three times above them. The approach that capitalizes current cash generation with no growth assumed puts the price about two thirds above it. Peer multiples land roughly a third to a half below. When no standard frame reaches the price, the honest description is that the price encodes something those frames do not contain, and for a silver producer that something is a view on the metal.

That view is the concrete "what has to be true," and the company's own planning assumptions make it legible. The 2026 operating plan is built on an assumed silver price of 52 dollars an ounce and gold at 3,900 dollars, while all-in sustaining costs are guided at roughly 28 dollars per payable silver equivalent ounce. The gap between those two figures is the margin, and it is doing all of the work in the valuation. A buyer at today's price is underwriting both that the spread persists and that production grows into it for the better part of a decade.

Production is the part that has been going right. Second quarter silver output was 3.8 million ounces against 3.7 million a year earlier, and full-year attributable guidance was raised 10% at the midpoint to 14.6 to 15.5 million silver ounces. Against the cohort, First Majestic's trailing operating margin near 31.6% on about $1.26 billion of revenue sits between Coeur Mining at 38.7% and Fortuna Mining at 14.3%, which places it mid-pack on operating conversion in a year when the whole group benefited from the same price.

The balance sheet removes one variable and introduces another. Cash and liquid assets exceed the debt, and operating profit covers interest roughly fifteen times, so there is no financing question inside this thesis. But the share count has been rising about 18.3% a year for four years, which means the growth being extrapolated has partly been purchased with equity. Per-share output, not total output, is what a long-term holder ends up owning.

Catalysts

The next dated event is immediate. First Majestic will release second quarter unaudited financial results and host a conference call on July 30, 2026. The production side of that quarter is already public: 3.8 million silver ounces, 34,660 gold ounces, 16.5 million pounds of zinc, 9.0 million pounds of lead and 252,938 pounds of copper from the four Mexican underground mines. What the July 30 release adds is the cost side, and the useful comparison will be realized all-in sustaining cost against the $27.69 to $28.77 per ounce full-year guidance range.

The guidance revision itself was the more significant July event. The company raised 2026 attributable silver production guidance to 14.6 to 15.5 million ounces from an original 13.0 to 14.4 million, a 10% increase at the midpoint, and lifted gold to 128,000 to 135,000 ounces, up 7%. Raising output guidance in the middle of a year is uncommon in underground mining and it happened despite a setback: a rockfall on the main ramp at Los Gatos in early April temporarily disrupted mining and required rehabilitation, followed by unplanned equipment maintenance that reduced tonnes processed.

Los Gatos is where the next operational proof point sits. The company has targeted achieving and sustaining a throughput level of 4,000 tonnes per day in the second half of 2026, and raised the mine's attributable production forecast about 5% at the midpoint to 5.1 to 5.5 million silver ounces. Whether that throughput target holds through the back half of the year is the single most controllable input in the story, and it will be visible in the quarterly production releases before it shows up anywhere else.

Peer Cohorts (Per Segment, With Filing Citations)

Core business (reported)

• BVN (BUENAVENTURA MINING CO INC)
• FY2025 20-F: …19.58 %, and other stakeholders own the remaining 4.34 %. The Company's legal address is Jacinto Ibañez Street N°315 - Parque Industrial, Arequipa in the city of Arequipa and the ore deposit is located 20 miles southwest of that city (Asiento Minero Cerro Verde S/N Uchumayo - Arequipa). (b) Business activity - The…
• FY2025 20-F: …financial performance. Management knows the conditions prevailing in the market and based on its knowledge and experience, manages the risks that are summarized below. The Company's Board of Directors reviews and approves the policies to manage each of these risks: (a) Market Risk - Commodity price risk - The…
• WOR (WORTHINGTON ENTERPRISES, INC)
• FY2025 10-K: …performance, competitive position, sales, volumes, cash flows, earnings, margins, balance sheet strengths, debt, financial condition or other financial measures; • pricing trends for raw materials and finished goods and the impact of pricing changes; • the ability to improve or maintain margins; • expected demand or…
• FY2025 10-K: …and UL Solutions. Building Products has one principal domestic competitor in the low-pressure LPG cylinder market, and a number of foreign competitors in the LPG cylinder, non-refillable refrigerant, and well water and expansion tank markets. We believe that this business has the largest market share in the domestic…
• CGAU (CGAU)
• FY2025 40-F: …and procedures regarding internal controls have not been specifically addressed in such charter. Quorum The NYSE suggests that the quorum for any meeting of holders of common stock of a listed company should not be less than a majority of the outstanding shares. The Company's by-laws set the quorum for the…
• FY2025 40-F: …conduct and ethics (the "Code"), by which it and all officers and employees of the Company, including the Company's principal executive officer, principal financial officer and principal accounting officer or controller, abide. There were no waivers granted in respect of the Code during the fiscal year ended December…
• HCC (Warrior Met Coal, Inc.)
• FY2025 10-K: …among the highest quality steelmaking coals in the world and is preferred as a base steelmaking coal in our customers' blends. Our marketing strategy is to focus on international markets mostly in Europe and 11 South America where we have a shipping time and distance advantage. In recent years, due to a combination…
• FY2025 10-K: …customer base of blast furnace steel producers, primarily located in Europe, South America and Asia. We have a shipping time and distance advantage serving customers throughout the Atlantic Basin relative to competitors located in Australia and Western Canada. Our strategic location is enhanced by our long-tenured,…
• ORLA (ORLA)
• FY2025 40-F: …and Mineral Reserve growth and updates; the Company's expectations regarding liquidity, financial flexibility, and the ability to fund operations and planned expenditures; the Company's sustainability strategy and its short-term and long-term sustainability goals, and the timing thereof; and the Company's other…
• FY2025 40-F: …of gold and silver; risks related to the Cerro Quema Project; unknown labilities in connection with acquisitions; global financial conditions; uninsured risks; climate change risks; competition from other companies and individuals; conflicts of interest; risks related to compliance with anti-corruption laws;…
• HL (HECLA MINING COMPANY)
• FY2025 10-K: …of operations, financial condition and cash flows could be materially adversely affected if one or more of our long-term customers were to decide to interrupt or curtail their activities, terminate their contracts with us or fail to renew existing contracts. Additionally, if spot market conditions deteriorate…
• FY2025 10-K: …losses, respectively, as part of the line item fair value adjustments, net on our statement of consolidated operations and comprehensive income (loss). Note 4: Business Segments, Sales of Products and Significant Customers F- 13 We discover, acquire and develop mines and other mineral interests and produce and market…
• TTAM (TTAM)
• FY2025 20-F: …in the demand and prices for our products and may have a material adverse effect on our business, results of operations and financial condition. We operate in a highly competitive industry. The markets for cement, aggregates and other construction materials and services are very competitive. Competition in these…
• FY2025 20-F: …Prices in these markets are subject to material changes in response to relatively minor fluctuations in supply and demand, general economic conditions and other market conditions beyond our control. In order to maintain or further reinforce our competitive position, we rely on periodic investments in the areas of…
• FSM (FSM)
• FY2025 40-F: …term is defined in Form 40-F) entitled the "Code of Conduct and Business Ethics" that applies to all of its directors, officers, employees, and consultants including its principal executive officer, principal financial officer, principal accounting officer or controller, and persons performing similar functions. ​…
• FY2025 40-F: …submitted by Fortuna Mining Corp. (formerly called Fortuna Silver Mines Inc.) (the " Company ") under the Exchange Act is duly recorded, processed, summarized and reported, within the time periods specified in rules and forms of the United States Securities and Exchange Commission (the " SEC "). Disclosure controls…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.