For a mining company like First Majestic (AG +3.76%), reporting a notably higher year-over-year gain in silver production usually leads to a jump in the stock price. Investors are finding, however, that this isn't always the case. The company reported strong third-quarter 2025 financial results yesterday before the market opened, but investors are instead keenly focused on another feature of the company's quarter.
According to data provided by S&P Global Market Intelligence, First Majestic stock is down 14.6% from the end of last Friday's market session through the end of trading today.
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One thing is robbing the silver stock of its lustrous third-quarter performance
In First Majestic's press release announcing the Q3 2025 financial results, the company provided an update on a tax dispute with the government of Mexico. Subsequent to the end of the third quarter, First Majestic learned that the Mexican Supreme Court had ruled against a subsidiary that the company wholly owns with respect to a taxation appeal regarding the San Dimas gold and silver mine.
NYSE: AG
Key Data Points
On the company's Q3 2025 conference call, management tried to dispel the notion that the unfavorable ruling was a major event. Keith Neumeyer, First Majestic's CEO, stated, "The tax dispute that seemingly some people are focused on today has been with the company for 13 years. There's no change. We continually work with the Mexican government to resolve the issue."
First Majestic reported a record for silver production in a single quarter of 3.9 million ounces, a 96% year-over-year increase. In addition, the company reported revenue of $285.1 million, a 95% increase over the same period last year.
Should investors buy First Majestic stock on the dip?
First Majestic stock provides a great opportunity right now for precious metals investors with shares valued at 13.3 times operating cash flow -- a discount to their five-year average cash flow multiple of 25.3. The silver production company's strong performance (which should continue in the coming quarters) certainly outshines any doubts that the taxation issue in Mexico is casting over the company.
