First Majestic Silver is trading at a significant premium to its peer group and to its own historical valuation metrics. The company’s enterprise value-to-production multiple now sits well above the average multiple for mid-tier silver producers, driven by investor enthusiasm for its recent operational achievements. However, rising operating costs—up approximately 12% year-over-year in Mexico—coupled with a consolidated net debt position of nearly $480 million, have fueled questions about sustainability. Analysts note that jurisdictional uncertainties in Mexico, including evolving fiscal regimes and community relations at key sites like San Dimas, could amplify risk for a stock trading at 1.5x its five-year average multiple.

In Q4 2025, First Majestic achieved record quarterly silver production of 4.2 million ounces, a 77% increase from 2.4 million ounces in Q4 2024. Total silver equivalent output reached 7.8 million ounces, up 37% year-over-year, with contributions from four underground Mexican mines: San Dimas, Santa Elena, La Encantada and its 70%-owned interest in Los Gatos. By-product metals added 14.2 million pounds of zinc, 8.1 million pounds of lead and 235,886 pounds of copper to the company’s credit. The company also completed 57,305 metres of drilling in the quarter, producing positive results at the Santo Niño and Navidad targets and prompting preliminary mine planning studies for potential integration into the Santa Elena district’s long-term plan.

First Majestic closed out 2025 with a full-year silver production record of 15.4 million ounces, an 84% increase over 2024, and silver equivalent output of 31.1 million ounces, up 43%. Gold production reached 147,433 ounces, marginally below prior guidance, while zinc and lead output of 56.7 million and 32.3 million pounds, respectively, surpassed internal targets. The successful integration of the Gatos Silver acquisition, completed in January 2025, drove much of this growth. The company’s Total Reportable Incident Frequency Rate (TRIFR) of 0.55 and Lost Time Incident Frequency Rate (LTIFR) of 0.12 underscore its industry-leading safety performance, earning Santa Elena an “Excellence in Safety” award from the Mexican Mining Chamber.

Looking into 2026, First Majestic has increased its quarterly dividend by 20% and plans to allocate up to $75 million for share repurchases over the next twelve months. Key initiatives include a mill expansion at Santa Elena designed to boost throughput by 15% and enhanced recovery projects at Los Gatos targeting a 5% lift in head grades. The company’s exploration budget of $60 million will focus on delineating new resources at Santo Niño, Navidad and the Ermitaño Luna Zone, with a maiden resource estimate for Santo Niño expected in Q1. Management emphasizes that maintaining a flexible balance sheet will be critical as operating costs continue to rise and potential regulatory changes in Mexico are evaluated.