After a massive 170% rally in 2025, silver prices have lost momentum, rising just 2.7% year to date. The slowdown reflects growing expectations that central banks will keep interest rates higher for longer, dampening investor appetite for precious metals. This shift clouds the near-term outlook for the Zacks Mining - Silver industry. Although underlying demand remains resilient, inflation will drive up operating costs, squeezing margins. 

We recommend considering companies such as Pan American Silver (PAAS Quick QuotePAAS - Free Report) and First Majestic Silver (AG Quick QuoteAG - Free Report) , which will benefit from enhanced operational efficiency, disciplined cost management and solid projects.

About the Industry

The Zacks Mining - Silver industry comprises companies that are engaged in the exploration, development and production of silver. These include big and small players operating mines of widely varying types and scales. Silver-bearing ores are mined by open-pit or underground methods and then crushed and ground. Miners continually look for opportunities to expand their reserves and resources through targeted near-mine exploration and business development. They strive to upgrade and improve the quality of their existing assets, internally and through acquisitions. Only 20% of silver comes from mining activities, wherein silver is the primary revenue source. The balance comes from projects wherein silver is a by-product of mining other metals, such as copper, lead and zinc. Thus, several companies in the silver mining industry are engaged in mining other metals.

What's Shaping the Future of the Mining-Silver Industry

Recent Dip in Silver Prices is Concerning: Silver delivered an exceptional performance in 2025, soaring 170% and far outpacing gold’s 66.5% gain. The rally was driven by a convergence of factors, including elevated geopolitical risks, economic uncertainty, resilient demand and tightening inventories. Also, 2025 marked a sharp reversal in ETF trends, with strong inflows after consecutive years of outflows, one of the key catalysts behind silver’s breakout. Adding to the bullish narrative, the U.S. Geological Survey included silver in its 2025 List of Critical Minerals, highlighting its strategic importance in defense, clean energy, electronics and medical technologies. This is expected to unlock policy support, faster permitting and efforts to strengthen domestic supply chains. The upward trend had extended in the earlier part of 2026, with silver reaching a record high of $121.64 per ounce in late January. Prices had gained on geopolitical and economic uncertainty. However, it has lost steam lately and is trading near $73 an ounce due to fears of rising inflation, increased oil costs from the Strait of Hormuz closure and expectations of sustained high interest rates.

Inflationary Costs to Hurt Margins: Industry players are facing escalating production costs, including electricity, wages, water and materials. Mining companies are major consumers of energy, with around 50% of their production costs closely linked to energy prices. Surging oil prices, spurred by the Iranian conflict, remain a headwind. A shortage of skilled workforce spiked wages. With no control over silver prices, the industry must focus on improving its sales volumes while being cost-effective. Players are investing heavily in R&D and resorting to technological innovations required at almost every level of operation to increase efficiency, sustain growth and rein in costs.

Strong Demand Underpins the Industry: Industrial applications account for roughly 59% of the total demand, with the solar energy industry being one of the main drivers. Silver use in photovoltaic (PV) technology has climbed sharply in recent years due to the increasing global adoption of solar technology, advances in solar cell design and the global push for renewable energy. Per the International Energy Agency (IEA), global renewable power capacity is expected to double between 2025 and 2030. Solar PV will account for 80% of the increase, given its low costs, faster permitting and rising social acceptance. Silver has been used by the automotive industry for many years, and there has been a steady increase in the use of electrical and electronic components driven by demand for enhanced safety features and improved functionality. The electrification of the automotive industry has boosted demand further. Battery electric vehicles use significantly more silver than hybrids or internal combustion engine vehicles, while the growing number of electronic control units further boosts consumption. Rapid digitalization and the rise of AI are emerging as powerful new demand drivers for silver. As economies transition toward clean energy, electrification and AI-led digital infrastructure, silver is increasingly cementing its role as a critical “next-generation metal.”

Zacks Industry Rank Indicates Lackluster Prospects

The group’s Zacks Industry Rank, basically the average of the Zacks Rank of all the member stocks, indicates gloomy prospects in the near term. The Zacks Mining – Silver industry, a 10-stock group within the broader Zacks Basic Materials sector, currently carries a Zacks Industry Rank #198, which places it in the bottom 19% of 244 Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperforms the bottom 50% by a factor of more than 2 to 1.

Despite the bleak near-term prospects, we will present a few Mining-Silver stocks that you can add to your portfolio, given their prospects. But it is worth looking at the industry’s shareholder returns and current valuation first.

Industry Versus Broader Market

The Mining-Silver Industry has outperformed the sector and the Zacks S&P 500 composite over the past year. The stocks in this industry have collectively gained 149.7% in the past year compared with the Basic Material sector’s 40.8% rise. Meanwhile, the Zacks S&P 500 composite has risen 32.6%.

One-Year Price Performance

 

Industry's Current Valuation

Based on the forward 12-month EV/EBITDA ratio, a commonly used multiple for valuing silver-mining companies, we see that the industry is currently trading at 6.87X compared with the S&P 500's 11.14X and the Basic Material sector's forward 12-month EV/EBITDA of 6.95X. This is shown in the charts below.

Enterprise Value/EBITDA (EV/EBITDA) F12M Ratio

Enterprise Value/EBITDA (EV/EBITDA) F12M Ratio

In the past five years, the industry has traded as high as 13.45X and as low as 5.15X, with the median being 8.04X.

2 Mining-Silver Stocks to Keep an Eye On

Pan American Silver: Through the acquisition of MAG Silver in September 2025, the company significantly strengthened its industry-leading silver reserve base and consolidated its position as one of the leading silver producers globally. Pan American Silver gained a 44% stake in the Juanicipio project, which is a large-scale, high-grade silver mine in Zacatecas operated by Fresnillo plc. In December 2025, the company reported strong drilling results for its operating mines, which will help advance its long-term exploration strategy to replace and grow its mineral resources. The company invested $94 million in project capital in 2025 to advance several major projects, among which the most notable is the La Colorada mine in Mexico. A recently updated Preliminary Economic Assessment for the La Colorada Skarn project indicates that the mine is poised to become one of the world's largest and lowest-cost silver mines. Following its development and ramp-up, the project is expected to produce an average of 19.1 million ounces of silver per year during its five highest-producing years. PAAS stock has gained 108.1% in the past year.

The Zacks Consensus Estimate for the company’s fiscal 2026 earnings indicates year-over-year growth of 73.6%. The estimate has moved up 9% in the past 60 days. PAAS has a trailing four-quarter earnings surprise of 37.5%, on average. PAAS currently carries a Zacks Rank #3 (Hold). 

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Price & Consensus: PAAS

First Majestic Silver: In January 2025, the company acquired Gatos Silver, Inc., gaining a 70% interest in the high-quality and long-life Cerro Los Gatos Silver underground mine. This deal solidified AG’s position as an intermediate primary silver producer. The company produced 3.5 million silver ounces in the first quarter of 2026, achieving 26% of the 2026 silver production guidance midpoint. Gold output was 34,341 gold ounces, representing 28% of the 2026 gold production guidance midpoint. In March, the company announced the results of a successful 2025 exploration program at its Jerritt Canyon Gold Mine. The company recently reported strong growth in Mineral Reserves and Mineral Resource Estimates for its operating mines and Jerritt Canyon. Based on this, the company commenced a restart plan for Jerritt Canyon. Strong momentum in the company’s First Mint LLC business, its wholly-owned minting facility, also bodes well. The business is experiencing strong sales of silver ounces. Also, the ISO 9001 certification (awarded in April 2025) has made the business’ silver product sales eligible for Individual Retirement Accounts (IRAs). Strong operational execution at the business has allowed First Majestic to sell a larger share of its total silver production to its bullion customers. AG shares have gained 211.5% in the past year. 

The Zacks Consensus Estimate for First Majestic’s 2026 earnings has moved up 20% in the past 60 days. The estimate indicates year-over-year growth of 56.5%. First Majestic currently carries a Zacks Rank of 3.

Price & Consensus: AG