First Majestic Silver

(AG; T.FR)
First Majestic Silver Image

First Majestic Silver is a senior mid-tier primary silver producer, on its way to a major (over 50 million silver equivalent ounces of production per year). Its run by President, CEO and founder Keith Neumeyer, who also founded First Quantum Minerals whose market cap today exceeds $11 billion.

I’ve been to most of their mines in Mexico, along with the Jerritt Canyon gold mine in Nevada. While costs are currently elevated at Jerritt, what many investors overlook is that it’s a turnaround project—which this “turnaround team” specializes in and has successfully done before.

First Majestic pays a quarterly dividend that’s pegged to revenue, so as the price of silver and gold rise, and as production increases, so does the dividend. The company has publicly said that another acquisition is on the table, and said we can “count on it” being a silver asset.

I’m on a first-name basis with the management team, but you may be surprised to know that’s not the reason I’m invested in AG. Analysts that cover the company all agree that production is going higher and costs are going lower, but that’s still not the reason. I have my capital at stake too, and there’s one big fat reason why:

You can get a good overview of the company from the current presentation here.

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