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First Majestic (AG) Rallies 10% Despite Y/Y Earnings Fall in Q1

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First Majestic Silver Corp.’s (AG - Free Report) shares have gained 10.2% since the company reported first-quarter 2021 results on May 6. Despite a year-over-year drop in earnings, investors were impressed with the higher sales driven by record online sales of coins and bullion, and robust silver prices. Adjusted earnings per share for the quarter came in at 3 cents, missing the Zacks Consensus Estimate of 7 cents. The company had reported adjusted earnings per share of 4 cents in the year-ago quarter.

Including one-time items, the company delivered earnings of 1 cent per share in the first quarter as against the loss per share of 15 cents incurred in the year-earlier quarter.

First Majestic’s revenues improved 16.7% year over year to $100.5 million in the March-end quarter, primarily aided by the increase in average realized silver price, partly offset by a 24% decrease in silver equivalent ounces sold. The revenue figure includes a record $4.8 million from silver coins and bullion sales from the company's online retail store. Notably, average silver price during the quarter rose 56% year over year to $27.13 per equivalent ounce.

First Majestic Silver Corp. Price, Consensus and EPS Surprise

First Majestic Silver Corp. Price, Consensus and EPS Surprise

First Majestic Silver Corp. price-consensus-eps-surprise-chart | First Majestic Silver Corp. Quote

Operational Update

First Majestic produced 4,540,296 silver equivalent ounces, down 26.7% from the prior-year quarter. Total production consisted of 2.9 million ounces of silver and 23,873 ounces of gold.

The company recorded cash costs per silver equivalent ounce of $12.61, up 53% from the year-ago quarter. Consolidated all-in sustaining costs (AISC) of $19.35 per silver equivalent ounce came in 58% higher than the prior-year quarter. Total production cost was $90.03 per ton, up 9% year over year.

First Majestic reported mine-operating profit of $28.1 million in the quarter, reflecting a year-over-year improvement of 33% on higher metal prices.

Financial Position

First Majestic ended first-quarter 2021 with $202 million of cash in hand, up from the $145 million held at the end of the prior-year period. Operating cash flow before movements in working capital and taxes were $31.1 million in the reported quarter compared with the prior-year quarter’s $23.3 million.

At the end of the first quarter, the company had total liquidity of $297.8 million, including $65 million of undrawn revolving credit facility.

Price Performance

Shares of the company have depreciated 5.4% over the past three months as against the industry’s growth of 2%.


 

Zacks Rank & Stocks to Consider

First Majestic currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the basic materials space include ArcelorMittal (MT - Free Report) , Celanese Corp. (CE - Free Report) and Dow Inc. (DOW - Free Report) .  All of these stocks flaunt a Zacks Rank #1 (Strong Buy) currently. You can see the complete list of today’s Zacks #1 Rankstocks here.

ArcelorMittal has a projected earnings growth rate of 984.7% for the current fiscal year. The company’s shares have soared nearly 179% in the past year.

Celanese has an expected earnings growth rate of 68.3% for the current fiscal year. The company’s shares have rallied around 90% over the past year.

Dow has an estimated earnings growth rate of 261.6% for the current fiscal year. The company’s shares have gained roughly 75% in a year’s time.

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