First Majestic Stock (NYSE:AG) Will Shine in a Silver Bull Market
Stock Analysis & Ideas

First Majestic Stock (NYSE:AG) Will Shine in a Silver Bull Market

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Are you a bullion bull but can’t easily put silver ingots in your portfolio? Not a problem, as First Majestic Silver is a major silver producer, and AG stock could provide plenty of leverage if the spot silver price flies higher.

Do you envision a bull market for silver in 2024? If so, it might be difficult to participate in a silver rally if you can’t conveniently put metals in your portfolio. Or maybe you’d just rather invest in a silver miner instead of physical silver or a silver ETF. That’s where First Majestic Silver (NYSE:AG) (TSE:FR) comes in. For this year and beyond, I am bullish on silver as well as AG stock.

First Majestic Silver is a Canadian company that mines for silver – a whole lot of silver, as we’ll discover. After all, it’s not a mere coincidence that First Majestic took the stock ticker “AG,” which is the symbol for silver on the periodic table of elements. So, let’s see if we can mine for profits with First Majestic, as AG stock is definitely more than just another shiny metal object in the markets.

Why Choose First Majestic Silver Stock Instead of Silver Bullion?

There’s a logical argument for owning silver, and I expect it to rise this year. Electric vehicle batteries and solar panels often use silver, for example. Hence, it makes sense to hold silver coins and/or bars if that’s feasible for you. However, you can also use First Majestic Silver stock as a proxy for silver and even get some leverage because AG stock sometimes magnifies the price moves of silver (in both directions, as you can see below).

Moreover, silver itself doesn’t pay a dividend, but First Majestic does (although it’s a small one). In fact, for the third quarter of 2023, First Majestic Silver declared a dividend distribution of $0.0046 per common share.

Furthermore, First Majestic Silver is a highly-respected silver miner with tens of thousands of hectares of prospective land in Mexico, a known hub of mineral production. Plus, First Majestic was incorporated way back in 1979, so this isn’t a recent start-up with no history.

The company is among the most active silver miners in the Western Hemisphere. In 2023’s fourth quarter, First Majestic’s total silver-equivalent production increased 6% quarter-over-quarter to 6.6 million ounces. For Fiscal Year 2023, the firm produced a mind-boggling 10.3 million silver-equivalent ounces.

Also, First Majestic’s total debt has stayed steady over the past year at around $250 million to $255 million, which isn’t unreasonably burdensome, especially relative to its total assets. The company’s total assets have grown over time to slightly more than $2 billion — not too shabby for a so-called “junior miner,” wouldn’t you agree?

Is AG Stock a Buy, According to Analysts?

On TipRanks, AG comes in as a Hold based on one Buy and five Hold ratings assigned by analysts in the past three months. The average First Majestic Silver price target is $6.52, implying 38.4% upside potential.

Conclusion: Should You Consider AG Stock?

Not everyone wants to store silver bullion, and it’s just not feasible for some investors. First Majestic Silver stock, on the other hand, can be bought in many brokerage accounts and even offers dividend payments.

Consequently, if you’re bullish on silver for 2024 and afterward, you might want to consider a position in AG stock. As First Majestic Silver ambitiously mines for silver, shareholders can participate if the silver price rises without holding any physical metals at all.



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