First Majestic Silver (AG 4.04%) stock tumbled 9% through 10:55 a.m. Tuesday, and it's not hard to figure out why.
First Majestic Silver focuses on mining both silver and gold in Mexico and the United States. Unfortunately for its investors, both silver and gold prices are down today.
Image source: Getty Images.
Gold and silver prices decline
After hitting an all-time high of $5,419.80 per ounce on Jan. 28, gold prices tumbled almost to $4,500 in early February, according to data from TradingEconomics.com. Gold moved back above $5,000 on Feb. 8, slipped below it Feb. 12, then up again, then down again. Today, gold sits at $4,878.
Silver prices have moved similarly -- but worse -- which isn't good news for a stock with "silver" in its name. Silver prices peaked on Jan. 28 at $116.58 per ounce. Silver prices fell to $66, then bounced back above $80 -- which appears to be a magic number for the metal. Again, prices passed above $80 on Feb. 8 and below $80 on Feb. 12. Unfortunately, silver prices haven't recovered since, remaining well below $80.
Today, silver costs $73.40.
NYSE: AG
Key Data Points
Is First Majestic Silver stock a buy?
Will silver prices bounce back? Will First Majestic Silver stock? We won't have long to wait for the answer, because First Majestic reports its Q4 earnings Thursday morning.
Analysts predict First Majestic will earn $0.23 per share -- seven times Q4 2024 profit -- but with full-year earnings of only $0.34. Worse, First Majestic stock costs about $21 a share, giving it a P/E ratio of more than 61x even if it hits its earnings target.
That seems pricey to me. Investors selling First Majestic stock ahead of earnings may be making the right call.
