In a recently published research report dated April 28, 2025, ROTH Capital Partners analyst Joe Reagor maintained a Neutral rating on MAG Silver Corp. (MAG:TSX; MAG:NYSE American), with an unchanged price target of US$16.00 per share. With the price at the time of the report being US$15.48, this target price represents an almost 4% implied investor return.
The report highlighted the company's strong first-quarter production figures but expressed caution about overall market volatility.
MAG Silver, which owns a 44% stake in the Juanicipio Joint Venture (JV) with Fresnillo Plc (56%), announced production results that surpassed analyst expectations for Q1 2025. The JV produced 4.5 million ounces of silver, 10,198 ounces of gold, 10.6 million pounds of lead, and 16.9 million pounds of zinc during the quarter. According to Reagor, this production beat was primarily due to slightly higher throughput and grades at the operation, though recoveries showed mixed results compared to previous estimates.
The precious metals market has experienced significant price increases in 2025, with gold reaching unprecedented heights at US$3,272 per ounce and silver following the upward trend at US$32.89 per ounce as of the report date. Reagor attributes this rally to increased market volatility stemming from policy changes under the Trump administration and renewed inflation concerns, particularly as new tariffs are expected to drive cost increases across numerous industries.
Despite the strong production figures and favorable metal prices, Reagor elected to maintain the US$16.00 price target for MAG shares. The report noted that these positive factors contributed to a US$0.10 per share increase in the company's discounted cash flow valuation, but this wasn't sufficient to warrant a target price adjustment. The analyst characterized Juanicipio as "a world-class asset that is relatively fairly valued by the market."
The financial outlook for MAG projects that 2025 will generate US$0.74 in fully diluted earnings per share, slightly below 2024's US$0.75, with a further decline to US$0.59 anticipated in 2026. This gradual decrease occurs despite the current favorable precious metals pricing environment.
Reagor's valuation approach combines an annualized discounted cash flow analysis using a 6.5% discount rate with a sum-of-the-parts methodology. The base DCF value of US$676.1 million is enhanced by a 50% premium (US$338 million) that accounts for potential acquisition by Fresnillo or another producer, as well as recognition of the high quality of MAG's underlying assets.
Additional value components include US$450 million for production and exploration upside at Juanicipio and US$75 million for other assets such as the Deer Trail and Larder projects. After adjusting for MAG's year-end 2024 net cash position of US$160.1 million and the company's 44% share of future estimated JV cash (US$17.6 million), the total calculated value reaches US$1.7 billion or US$16.28 per fully diluted share, which Reagor rounds down to arrive at the US$16.00 target price.
The report also outlines several key risk factors that could impact MAG Silver's performance, including political risks related to potential regulatory changes in Mexico, commodity price fluctuations (particularly for silver), operational and technical challenges common to mining companies, and broader market risks associated with economic cycles.
As of April 25, 2025, MAG Silver was trading at US$15.48 per share, within its 52-week range of US$11.58 to US$17.99. The company has 103.45 million shares outstanding, giving it a market capitalization of approximately US$1.62 billion. According to the most recent financial reports, MAG held US$162.3 million in cash against just US$2.2 million in total debt.
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Disclosures for ROTH Capital Markets, MAG Silver Corp., April 28, 2025
Regulation Analyst Certification ("Reg AC"): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report. Disclosures: ROTH makes a market in shares of MAG Silver Corp. and as such, buys and sells from customers on a principal basis.
Each box on the Rating and Price Target History chart above represents a date on which an analyst made a change to a rating or price target, except for the first box, which may only represent the first note written during the past three years. Distribution Ratings/IB Servicesshows the number of companies in each rating category from which Roth or an affiliate received compensation for investment banking services in the past 12 month. Distribution of IB Services Firmwide IB Serv./Past 12 Mos. as of April 27, 2025 Rating Count Percent Count Percent Buy [B] 366 78.21 111 30.33 Neutral [N] 84 17.95 5 5.95 Sell [S] 0 0.00 0 0 Under Review [UR] 17 3.63 3 17.65
Our rating system attempts to incorporate industry, company and/or overall market risk and volatility. Consequently, at any given point in time, our investment rating on a stock and its implied price movement may not correspond to the stated 12-month price target. Ratings System Definitions - ROTH Capital employs a rating system based on the following: Buy: A rating, which at the time it is instituted and or reiterated, that indicates an expectation of a total return of at least 10% over the next 12 months. Neutral: A rating, which at the time it is instituted and or reiterated, that indicates an expectation of a total return between negative 10% and 10% over the next 12 months. Sell: A rating, which at the time it is instituted and or reiterated, that indicates an expectation that the price will depreciate by more than 10% over the next 12 months. Under Review [UR]: A rating, which at the time it is instituted and or reiterated, indicates the temporary removal of the prior rating, price target and estimates for the security. Prior rating, price target and estimates should no longer be relied upon for UR-rated securities. Not Covered [NC]: ROTH Capital does not publish research or have an opinion about this security. ROTH Capital Partners, LLC expects to receive or intends to seek compensation for investment banking or other business relationships with the covered companies mentioned in this report in the next three months. The material, information and facts discussed in this report other than the information regarding ROTH Capital Partners, LLC and its affiliates, are from sources believed to be reliable, but are in no way guaranteed to be complete or accurate. This report should not be used as a complete analysis of the company, industry or security discussed in the report. Additional information is available upon request. This is not, however, an offer or solicitation of the securities discussed. Any opinions or estimates in this report are subject to change without notice. An investment in the stock may involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Additionally, an investment in the stock may involve a high degree of risk and may not be suitable for all investors. No part of this report may be reproduced in any form without the express written permission of ROTH. Copyright 2025. Member: FINRA/SIPC.
