Investing in quality mining stocks offers portfolio diversification and exposure to the commodity sector. One top TSX mining stock is First Majestic Silver (TSX:AG), valued at a market cap of $5.5 billion.
First Majestic Silver stock has returned 34% in the last 12 months and has almost doubled investor returns over the past decade. Let’s see if this TSX stock remains a good investment right now.
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Is this TSX mining stock a good buy?
First Majestic Silver is engaged in the acquisition, exploration, development, and production of mineral properties. Over the years, First Majestic Silver has focused on strong operational momentum, positioning itself as a key player among silver miners.
The silver miner ended Q1 2025 with a record cash position of US$462.6 million and US$544 million in total liquidity. A strong balance sheet provides First Majestic Silver with the flexibility for growth investments and operational optimization.
It reported record sales of US$244 million in Q1 and an operating cash flow of US$110 million, showcasing an ability to generate meaningful returns from its mining operations.
Record silver production
Operationally, First Majestic achieved record silver production of 3.7 million ounces in Q1, with improving cost metrics showing cash costs declining to US$13.68 per ounce. In 2025, it estimates silver production between 13.6 million ounces and 15.3 million ounces, representing 71% growth at the midpoint compared to 2024 levels.
The January 2025 acquisition of a 70% stake in Cerro Los Gatos enhances the company’s production profile, adding a low-cost underground operation with robust exploration potential.
Combined with existing assets including Santa Elena, San Dimas, and La Encantada mines in Mexico, First Majestic controls over 350,000 hectares across three world-class silver mining districts.
The bull case for the TSX stock
First Majestic Silver benefits from compelling silver market fundamentals that underscore the metal’s critical importance and supply constraints. The unique properties of silver make substitution nearly impossible, given its status as the most electrically conductive metal.
The silver market faces a structural imbalance, with annual consumption reaching 1.2 billion ounces while mine production delivers only 835 million ounces. This supply-demand mismatch has created five consecutive years of market deficits, including an estimated 150-million-ounce shortfall in 2024 and a projected 120-million-ounce deficit for 2025.
Soaring demand
Industrial demand has increased by 33% since 2020, reaching 681 million ounces by 2024. Moreover, photovoltaic solar applications represent a dynamic growth segment, with silver demand reaching 198 million ounces in 2024, a 140% increase since 2020. This PV demand now accounts for 25% of total global mined silver production.
The current silver supply mix relies on mining for 81% and recycling for 19%, yet new mine supply remains limited while industrial applications continue to expand.
With electrical and electronics demand totalling 461 million ounces in 2024, a 31% increase since 2020, the structural deficit appears likely to persist, creating a favourable environment for silver producers like First Majestic.
The miner’s vertical integration strategy through First Mint, its Nevada-based bullion facility, creates additional value capture opportunities by eliminating middlemen and capitalizing on strong physical silver investment demand.
With improving ESG scores and a dividend policy tied to revenue performance, First Majestic positions itself as a comprehensive silver investment vehicle for investors seeking exposure to the precious metals sector.
Analysts expect adjusted earnings for the TSX stock to expand from US$0.08 per share in 2025 to US$0.39 per share in 2027. If First Majestic stock is priced at 30 times forward earnings, it will trade around US$12 in early 2027, indicating an upside potential of over 40% from current levels.
