Silver Discovery Program Ignites in Mexico's Historic Mining Belt

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1.  Ownership and Share Structure Information

The information listed above was updated on the date this article was published and was compiled from information from the company and various other data providers.

Sierra Madre Gold and Silver Ltd. (SM:TSX.V; SMDRF:OTCQX) has initiated a US$3.5 million exploration program at the East District of its Guitarra silver-gold project in Estado de Mexico. This district, part of the historically significant Temascaltepec mining area, marks a renewed focus on underexplored territory following the successful restart of operations at the Guitarra and Coloso mines earlier this year.

The exploration work will unfold in two stages. The first, estimated to last nine months, will involve detailed geological surface mapping, sampling of historical workings, and structural analysis to define drill targets. The second stage proposes a 20,000 to 25,000 meter drilling campaign to evaluate the economic potential of identified targets. Fieldwork has already begun, and new senior-level geologists and support personnel have been brought on to assess the condition of existing infrastructure, with access regained to the Santa Ana vein system's Rampa Carolina, a 300-meter underground development dating back to 2007.

The company referenced historical estimates from a 2023 NI 43-101 report indicating East Disctrict resources at Mina de Agua of 761,000 tonnes grading 159 grams per tonne silver and 0.19 grams per tonne gold, and inferred resources of 545,000 tonnes grading 178 grams per tonne silver and 0.13 grams per tonne gold.

According to Chief Operating Officer Greg Liller in the news release, "The East District is the last of the six major Spanish Colonial production centres in Mexico that has not been systematically mapped, drilled, and evaluated using modern tools and methods." Chief Executive Officer Alex Langer added that the program will be funded through treasury and cash flow, supported by a CA$19.5 million private placement completed in July 2025.

Precious Metals Market Maintains Strength Amid Volatility

Peter Krauth of The Gold Advisor wrote on October 22 that silver had reached a record high of US$54 per ounce before undergoing what he described as a healthy correction. He noted that "even with the pullback of the last few days, silver [was] still up a whopping 64% this year alone." Krauth explained that strong industrial demand, tight supply conditions, and a "silver squeeze" caused by short covering had all contributed to the surge.

He added that buyers had been willing to pay premiums for immediate delivery due to tight inventories, a condition known as backwardation, though he said this extreme tightness had since eased. According to his commentary, the correction that followed such gains was "normal behavior for these assets" and reflective of a market undergoing consolidation rather than decline.

According to a Kitco Media report published October 23 by Gary Wagner, gold was also showing "early indications of recovery after experiencing its most severe single-day correction in over eighteen years." The report detailed how spot gold and December Comex futures had both formed doji candlestick patterns, a sign that traders viewed the correction as a technical retracement following months of strong appreciation. Wagner wrote that "the pullback appear[ed] technically sound given gold's remarkable 57% year-to-date appreciation," with buyers re-entering the market at lower prices and lifting gold US$95 above its intraday low.

On October 24, Morris Hubbartt of 321Gold stated that conditions in the precious metals market had created what he called a "blast-off zone" for many junior miners. He noted the rebranding of his service to "Super Gold Signals," reflecting what he described as "the growing global importance of gold." His comments underscored ongoing investor enthusiasm for gold-focused equities amid volatile but resilient price movements across the broader metals sector.

Analysts Highlight Strong Growth Potential at Sierra Madre

On September 8, VSA Capital analyst Oliver O'Donnell reaffirmed a Buy recommendation on Sierra Madre Gold and Silver Ltd., maintaining a target price of CA$1.40. At the time of the report, the stock was trading at CA$1.03. O'Donnell cited the company's production growth plan to scale from 760,000 to 2.1 million silver-equivalent ounces annually by 2027. He noted that the expansion would be supported by the CA$19.5 million capital raise completed in July and projected capital expenditures of US$21 million through 2028, including investments in a paste fill plant and a new tailings facility. O'Donnell forecasted that unit costs could decline to US$16 per silver-equivalent ounce and estimated revenues of US$73 million and EBITDA of US$37 million by 2028. He added, "The company's operational milestones, including equipment procurement and permitting, position it well to execute the expansion timeline."

Dominic Frisby of The Flying Frisby described Sierra Madre as his "favorite silver play" and largest position in the sector.

Later that month, on September 18, Ted Butler of The Gold Advisor commented on the development of the Nazareno mine, calling it "a significant contributor" to future production. Butler pointed out that the 700 tonnes of material already delivered to the plant were not part of the 2023 resource estimate and wrote, "The rock coming out of Nazareno is richer than expected," citing silver grades 40% higher and gold grades 30% higher than previously modeled. Butler stated that the use of portable drill rigs would reduce costs and improve access to tightly spaced mineralized zones.

In a September 30 follow-up, Butler reiterated his firm's full weighting in the company and added that Sierra Madre was "building momentum across its operations." He highlighted the adoption of long-hole mining techniques at Nazareno and expressed confidence in the company's ability to maximize value from unmodeled resources.

In an October 1 research note, Oliver O'Donnell further remarked that Sierra Madre had brought a third mine, Nazareno, into production within the La Guitarra complex. He stated, "The company's expansion strategy is taking further shape, and the addition of another high-grade production zone will support near-term production and earnings."

Thibaut Lepouttre of Caesars Report offered additional insight on October 10, observing that Sierra Madre had begun underground development at the Nazareno mine. He wrote, "The Nazareno project is interesting as several silver- and gold-bearing veins appear to merge, creating a mineralized zone up to 8 meters wide."

In an October 15 contribution, Dominic Frisby of The Flying Frisby described Sierra Madre as his "favorite silver play" and largest position in the sector. He credited the company for meeting development targets ahead of schedule and explained that production costs, initially estimated at US$30 per ounce, were expected to decline to US$20 per ounce within two years due to equipment upgrades and operational improvements.

"Production costs are coming down, meaning profits should double," Frisby stated. He also noted the company's plans to increase daily throughput to 750–800 tonnes by the second quarter of next year, with a longer-term target of reaching 1,500 tonnes per day by the third quarter of 2027. Citing CEO Alex Langer, Frisby added that Sierra Madre had acquired what could be "the largest undeveloped silver district in Mexico."

Mapping a New Frontier in a Historic District

The East District's exploration marks a pivotal expansion in Sierra Madre's district-wide development strategy. While the West District has been the site of modern production at the Guitarra, Coloso, and Nazareno mines, the East District has remained largely untouched by contemporary exploration methods despite hosting numerous historical mines and vein systems spanning over 39 kilometers.

With the West District already producing and plant expansion plans underway to increase capacity by up to 100% by 2027, the East District offers a significant upside. The newly launched drill program is intended to build on historic findings from Luismin and others, which suggest silver grades between 440 and 670 grams per tonne and gold grades of 2.4 to 3.6 grams per tonne across several veins. 

Sierra Madre's management has emphasized that the current expansion and exploration initiatives, including this East District program, will be internally funded. As of June 30, 2025, the company held US$5.9 million in current assets, and the July 2025 private placement added an additional CA$19.5 million in working capital.

With full commercial production at the Guitarra mine underway since January 1, 2025, and exploration beginning in previously untested zones, Sierra Madre continues to advance its district-scale strategy in Mexico's prolific silver belt.

Ownership and Share Structure¹

Management and founders own approximately 21.4% of the company. According to LSEG, President and CEO Alexander Langer owns 2.68% of the company, Executive Chairman and COO Gregory K. Liller owns 1.77%, Director Jorge Ramiro Monroy owns 1.32%, Director Alejandro Caraveo owns 1.26%, Director Kerry Melbourne Spong owns 0.57%, and Director Gregory F. Smith owns 0.14%.

Institutional investors own 24.3% of the company. Commodity Capital A.G. owns 4.4%, Refinitiv reported. Strategic investors hold 37.7%. The rest is retail.  

Sierra Madre has a market cap of CA$235 million and a 52-week range of CA$0.345 to CA$1.60.