We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Can Pan American Silver Deliver on Its 2025 Production Targets?
Read MoreHide Full Article
Key Takeaways
PAAS met Q1 silver and gold targets, aided by solid performance at its mines.
The pending $2.1B MAG Silver deal may raise PAAS' 2025 silver output
PAAS shares are up 41.8% YTD, outpacing both the industry and broader market gains.
Pan American Silver (PAAS - Free Report) kicked off 2025 with an operating performance that aligned with its expectations. The company also signaled a promising trajectory for the remainder of the year.
Silver production was 5 million ounces for the quarter, hitting the high end of the projected 4.75 - 5 million ounces. The figure was in line with the year-ago quarter.
La Colorada reported higher output owing to a significant improvement in ventilation conditions. El Peñon saw gains attributed to higher throughput, resulting from additional ore tons mined, as well as higher silver grades. Huaron reported improved numbers due to higher throughput from additional development meters and tons, but at lower grades.
As expected, these gains were offset by lower output at Cerro Moro and San Vicente due to mine sequencing into lower silver grade zones. Production at Dolores was down following the cessation of mining operations in July 2024 and the site transitioning into its residual leaching phase.
Gold production came in at 182.2 thousand ounces, within the guided 175–189 thousand ounces. It was lower than the 222.9 thousand ounces produced in the year-ago quarter owing to the sale of the La Arena mine in December 2024, cessation of activity at Dolores and lower gold grade ores mined at Minera Florida and Shahuindo.
PAAS expects silver and gold production to ramp up through the remaining quarters of the year. It maintains its 2025 silver production at 20–21 million ounces compared with the 2024 output of 21.1 million ounces. At La Colorada, the improvement in ventilation conditions is expected to enable higher development rates, enabling throughput of up to 2,000 tons per day. At Huaron, the development of the Horizonte zone is expected to lead to higher throughput and improved silver grades. Lower output at San Vicente and the loss of contribution at Dolores will somewhat offset these positives. Gold production for 2025 is projected at 735 – 800 thousand ounces, lower than 895.5 thousand ounces in 2024, owing to the loss of contribution of La Arena mine and Dolores.
Pending MAG Silver Acquisition to Boost PAAS’ Production
Pan American Silver is set to acquire MAG Silver Corp. (MAG - Free Report) in a $2.1 billion deal. The deal entails the acquisition of MAG Silver’s 44% stake in the Juanicipio project.
Juanicipio is forecasted to produce 14.7-16.7 million ounces of silver in 2025, of which MAG Silver’s expected share is 6.5–7.3 million ounces. If the MAG Silver deal closes in the second half of the year (as expected), Pan American Silver could benefit from a prorated production boost. Its stated silver output for 2025 can likely go up to 23.2–24.7 million ounces.
PAAS’ Peer Check: Hecla Mining’s Performance
Pan American Silver’s closest North American peer, Hecla Mining Company (HL - Free Report) , also posted a solid start to 2025. It produced 4.1 million ounces of silver and 34,232 ounces of gold in the first quarter. Hecla Mining established a new quarterly milling record at Lucky Friday of 108,745 tons, beating the previous record. Keno Hill production was 772,430 ounces of silver, up 23% sequentially. For 2025, Hecla Mining is guiding silver production at 15.5 - 17.0 million ounces compared with the 2024 output of 16.2 million ounces.
Gold production is expected at 120 - 130 thousand ounces, lower than the 142 thousand ounces produced in 2024 due to reduced output at Casa Berardi as the mine transitions to a surface-only operation.
PAAS’ Price Performance, Valuation & Estimates
Year to date, PAAS shares have gained 41.8%, outpacing the industry's 32.1% growth. In comparison, the Basic Materials sector has risen 7.2%, while the S&P 500 has moved up 0.8%.
Image Source: Zacks Investment Research
PAAS is currently trading at a forward 12-month price-to-earnings multiple of 17.13X compared with the industry average of 18.40X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Pan American Silver’s earnings for 2025 has moved up 9.7% over the past 60 days, while the same for 2026 has moved down 3.57%.The consensus mark for 2025 earnings is pegged at $1.47 per share, indicating a year-over-year surge of 86.1%. The estimate for 2026 of $1.89 indicates an increase of 28.7%.
Image Source: Zacks Investment Research
PAAS stock currently carries a Zacks Rank #3 (Hold).
Image: Bigstock
Can Pan American Silver Deliver on Its 2025 Production Targets?
Key Takeaways
Pan American Silver (PAAS - Free Report) kicked off 2025 with an operating performance that aligned with its expectations. The company also signaled a promising trajectory for the remainder of the year.
Silver production was 5 million ounces for the quarter, hitting the high end of the projected 4.75 - 5 million ounces. The figure was in line with the year-ago quarter.
La Colorada reported higher output owing to a significant improvement in ventilation conditions. El Peñon saw gains attributed to higher throughput, resulting from additional ore tons mined, as well as higher silver grades. Huaron reported improved numbers due to higher throughput from additional development meters and tons, but at lower grades.
As expected, these gains were offset by lower output at Cerro Moro and San Vicente due to mine sequencing into lower silver grade zones. Production at Dolores was down following the cessation of mining operations in July 2024 and the site transitioning into its residual leaching phase.
Gold production came in at 182.2 thousand ounces, within the guided 175–189 thousand ounces. It was lower than the 222.9 thousand ounces produced in the year-ago quarter owing to the sale of the La Arena mine in December 2024, cessation of activity at Dolores and lower gold grade ores mined at Minera Florida and Shahuindo.
PAAS expects silver and gold production to ramp up through the remaining quarters of the year. It maintains its 2025 silver production at 20–21 million ounces compared with the 2024 output of 21.1 million ounces. At La Colorada, the improvement in ventilation conditions is expected to enable higher development rates, enabling throughput of up to 2,000 tons per day. At Huaron, the development of the Horizonte zone is expected to lead to higher throughput and improved silver grades. Lower output at San Vicente and the loss of contribution at Dolores will somewhat offset these positives.
Gold production for 2025 is projected at 735 – 800 thousand ounces, lower than 895.5 thousand ounces in 2024, owing to the loss of contribution of La Arena mine and Dolores.
Pending MAG Silver Acquisition to Boost PAAS’ Production
Pan American Silver is set to acquire MAG Silver Corp. (MAG - Free Report) in a $2.1 billion deal. The deal entails the acquisition of MAG Silver’s 44% stake in the Juanicipio project.
Juanicipio is forecasted to produce 14.7-16.7 million ounces of silver in 2025, of which MAG Silver’s expected share is 6.5–7.3 million ounces. If the MAG Silver deal closes in the second half of the year (as expected), Pan American Silver could benefit from a prorated production boost. Its stated silver output for 2025 can likely go up to 23.2–24.7 million ounces.
PAAS’ Peer Check: Hecla Mining’s Performance
Pan American Silver’s closest North American peer, Hecla Mining Company (HL - Free Report) , also posted a solid start to 2025. It produced 4.1 million ounces of silver and 34,232 ounces of gold in the first quarter. Hecla Mining established a new quarterly milling record at Lucky Friday of 108,745 tons, beating the previous record. Keno Hill production was 772,430 ounces of silver, up 23% sequentially. For 2025, Hecla Mining is guiding silver production at 15.5 - 17.0 million ounces compared with the 2024 output of 16.2 million ounces.
Gold production is expected at 120 - 130 thousand ounces, lower than the 142 thousand ounces produced in 2024 due to reduced output at Casa Berardi as the mine transitions to a surface-only operation.
PAAS’ Price Performance, Valuation & Estimates
Year to date, PAAS shares have gained 41.8%, outpacing the industry's 32.1% growth. In comparison, the Basic Materials sector has risen 7.2%, while the S&P 500 has moved up 0.8%.
PAAS is currently trading at a forward 12-month price-to-earnings multiple of 17.13X compared with the industry average of 18.40X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Pan American Silver’s earnings for 2025 has moved up 9.7% over the past 60 days, while the same for 2026 has moved down 3.57%.The consensus mark for 2025 earnings is pegged at $1.47 per share, indicating a year-over-year surge of 86.1%. The estimate for 2026 of $1.89 indicates an increase of 28.7%.
Image Source: Zacks Investment Research
PAAS stock currently carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.