Silver X Mining Corp. (AGX:TSX.V) announced it continues to see an increase in production at its Nueva Recuperada district-scale property in Peru since its pivotal restart last September.
The company said mining tonnage went up 20% in the first quarter ending March 31 over production from Q4 2023.
The company also noted a 3% increase in silver equivalent processing to more than 363,000 ounces silver equivalent (Ag Eq) in Q1 2024 over the last quarter and a 2% increase from Q1 2023, "showcasing sustained growth."
"We are pleased to report our second consecutive quarter of increased mine production and mill throughput, alongside persistent efforts towards reducing costs at both operational (and) corporate levels," Chief Executive Officer Jose M. Garcia said. "These results confirm that our Nueva Recuperada operations are on track. The combination of production with this outstanding geological setting makes Silver X one of the most attractive investment cases."
Red Cloud Securities analyst Timothy Lee called the update's impact "positive" in an April 25 updated research note.
Lee noted that the company processed 37,903 tons of ore at a head grade of 299 grams per tonne (g/t) Ag Eq to produce 298,047 ounces Ag Eq in the first quarter, "which was above our estimate of 250,670 (ounces) Ag Eq."
"In our opinion, these are positive production results for Silver X," wrote Lee, who rated the stock a Buy with a CA$0.75 per share target price. "The processed tonnage and overall Ag Eq production were both above our estimates. … The stepwise improvement from Q4/23 to Q1/24 contrasts with AGX’s pre-shutdown quarterly volatility in operational performance. Overall, this is a positive step in the ramp-up of production at Nueva Recuperada."
Red Cloud Securities analyst Timothy Lee called the update's impact "positive" in an April 25 updated research note.
Vancouver-based Silver X said it consolidates and develops undervalued assets and creates value by expanding resources and increasing production. The company owns two properties in Peru: Nueva Recuperada and Coriorcco.
Nueva Recuperada, its flagship project, covers 230 mining concessions over 20,000 hectares in a tier 1 mining jurisdiction. It is comprised of the Plata, Tangana, and Red Silver mining units. Coriorcco is a 2,000-hectare exploration-stage gold property in Ayacucho, southeast of Nueva Recuperada, with the potential for standalone development. It has known gold-silver mineralization at surface, with vein widths ranging from 1 meter to 2.5 meters in width.
Both properties offer significant exploration potential, the company said.
Untapped Exploration Potential
Silver X said Nueva Recuperada recorded an improvement in silver recovery rates in the first quarter of this year, reaching an average of 89.2%, indicating "enhanced efficiency in mineral extraction processes."
The company said it also "successfully met operational targets for Q1 2024, setting a strong precedent for the coming quarter as the company pivots toward replicating this success in Q2, with a strategic outlook on enhancing production volumes."
Overall, Silver X is working toward completing two goals at Nueva Recuperada by 2026, the company said. One is expanding the project's current Measured and Indicated resource by four times. The second is tripling its current production of silver equivalent.
The current Inferred resource at Plata is 448,812 tons of 220.81 g/t Ag, 2.55% lead (Pb), and 4.58% zinc (Zn). This was calculated based on historical exploration work and included in the 2022 Nueva Recuperada preliminary economic assessment.
"Evidence from historical sampling and development work indicates the existence of higher-grade mineralization at depths below 4,460 meters (4,460m) above sea level, highlighting untapped exploration potential," Silver X pointed out in its 2024 corporate presentation.
The Catalyst: Silver Breakout 'Imminent'
The price of silver was US$27.57 per ounce as of 9 a.m. ET Friday. According to USA Today, that’s up 0.09% from the previous day’s silver price per ounce and up 15.21% since the beginning of the year.
In addition to being a precious metal, silver is the most conductive element in nature. It's important to the green economy transition because it's used to coat electrical contacts in computers, phones, cars, and appliances. It's also an important element in solar technology.
In an update last year, the World Silver Institute said there was a deficit of 140 million ounces (Moz) between supply and demand for silver in 2023, compared to 237.7 Moz in 2022. However, the institute also noted that global output shrunk by 2% in 2023.
"Mined output over the longer term, four to five years out, is forecast to begin to decline," the institute said in its World Silver Survey 2023. "This will be due to losses from grade decline and reserve depletion at existing operations exceeding the new production that is expected to come online from the current project pipeline."
Asset manager Chen Lin, author of the What is Chen Buying? What is Chen Selling? newsletter is betting big on the metal this year, naming two other silver explorers among his top picks for the year: Cerro de Pasco Resources Inc. and Hycroft Mining Holding Corp.
The timing should be right for Silver X as well, noted Technical Analyst Clive Maund, who recommended his readers stay long on the stock and rated it an Immediate Strong Buy for all timeframes.
"Silver should make a move; it's about time," Chen said. "I expect another huge deficit for 2024. That should excite the market. I see silver hitting new highs."
Ron Struthers of Struthers Resource Stock Report, who typically follows gold, recently wrote that a breakout was "imminent" for silver.
"As they say, timing is everything, and I believe the time is soon arriving" for silver, he said.
The timing should be right for Silver X as well, noted Technical Analyst Clive Maund, who recommended his readers stay long on the stock and rated it an Immediate Strong Buy for all timeframes.
"The stock chart for Silver X supports the contention that it will soon take off at a higher level," Maund wrote on April 4.
Streetwise Ownership Overview*"With the outlook for silver prices now better than it has been for many years . . . the STRONGLY BULLISH CASE FOR SILVER COULD NOT BE CLEARER. The case for buying Silver X here is viewed as ironclad."
Ownership and Share Structure
According to Reuters, Silver X has 172.74 million shares outstanding and 124.08 million free-float traded shares.
Silver X said management and insiders own approximately 17% of the company. According to Reuters, President and CEO Jimenez Jose Maria Garcia owns 8.24% of the company, Vice President Sebastian Wahl owns 8.35%, Director Michael Hoffman owns 0.23%, and CFO Ronald Anibal Marino Sanchez owns 0.06%.
The company said institutional investors own 23%. Some listed by Reuters include Baker Steel Resources Trust Ltd. owns 11.29%s, US Global Investors Inc. owns 4.63%, and Sprott Asset Management LP owns 1.07%.
Retail investors own the remaining.
Silver X has a market cap of CA$39.98 million and a 52-week trading range of CA$0.16−0.41 per share.
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Important Disclosures:
- Silver X Mining Corp. has a consulting relationship with an affiliate of Streetwise Reports, and pays a monthly consulting fee between US$8,000 and US$20,000.
- As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Silver X Mining Corp.
- Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
- This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.
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Contributing Author Disclosures:
- Author Certification and Compensation: [Clive Maund of clivemaund.com] is being compensated as an independent contractor by Street Smart, an affiliate of Streetwise Reports, for writing this article. Maund received his UK Technical Analysts’ Diploma in 1989. The recommendations and opinions expressed in this content accurately reflect the personal, independent, and objective views of the author regarding any and all of the designated securities discussed. No part of the compensation received by the author was, is, or will be directly or indirectly related to the specific recommendations or views expressed
Clivemaund.com Disclosures
The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks cannot be only be construed as a recommendation or solicitation to buy and sell securities.
