Pan American Silver (PAAS) is one of the largest global primary silver producers and a sizeable gold miner, with operations in North, Central and South America since 1994. It currently owns 10 producing mines, as well as the suspended top-tier Escobal silver mine and a number of large-scale advanced exploration and development assets. The diversified portfolio provides both scale and upside optionality. The company is listed on both the Toronto Stock Exchange and the New York Stock Exchange, with a market capitalisation of over $22bn.
PAAS’s flagship silver operation is the La Colorada mine in Mexico. It boasts 91Moz in contained silver reserves, producing silver-rich lead and zinc concentrates at a rate of c 2,000tpd. Recent strong exploration results indicated multiple high-grade intercepts along and below the strike of the known vein system, resulting in the addition of 53Moz of silver to inferred mineral resources.
In the gold segment, the Jacobina mine in Brazil is a large-scale, low-cost, long-life operation with 3.1Moz in contained gold reserves and significant exploration upside. A comprehensive study on the project is currently being undertaken by PAAS to optimise its long-term economics and increase output.
Below we highlight five key reasons why PAAS represents an exciting investment case:
1. Exceptional exposure to silver through existing operations and growth projects.
The company offers exceptional exposure to silver thanks to its well-diversified asset base and significant long-term growth optionality through the La Colorada Skarn, Escobal and Navidad projects. La Colorada Skarn is a large, silver-bearing polymetallic deposit discovered by the company in 2018 through brownfield exploration near the existing La Colorada mine. Containing more than 300Moz of indicated silver resource, it is envisaged to produce large quantities of silver, zinc and lead for decades. The recent exploration results at the adjacent La Colorada mine present exciting opportunities for development and the company is currently evaluating a two-stage development approach for the Skarn project. This approach would reduce capital intensity and accelerate a substantial increase in silver production relative to the initial preliminary economic assessment (PEA) released in January 2024. A revised PEA incorporating this new development pathway is planned for Q226. Concurrently, PAAS is discussing partnership arrangements for the development of the project.
2. Well-timed and value-accretive M&A strategy.
PAAS has grown significantly over the years, actively managing its asset portfolio to maximise shareholder returns through value-accretive acquisitions and by focusing on its most profitable and long-life operations. The company’s transformative deals include Tahoe Resources in 2019 and Yamana Gold’s South American assets in 2023. Both transactions were well timed and closely aligned with commodity cycles, allowing the company to significantly increase its exposure to gold to take advantage of rising metal prices. At the same time, PAAS divested non-core assets, directing a portion of the proceeds to enhancing the company’s exposure to silver with the acquisition of the world-class Juanicipio silver mine.
3. Juanicipio acquisition has a strong rational and offers significant upside
PAAS’s most recent transaction to acquire MAG Silver was similarly well timed, as it was executed on the cusp of another significant step change in silver and gold prices. MAG’s key asset is a 44% interest in the large-scale, high-grade Juanicipio mine in Mexico, commissioned in 2023 and operated by Fresnillo. The acquisition is set to boost the company’s exposure to silver, increasing silver production by c 30% while visibly lowering its consolidated silver costs. Juanicipio is a highly cash-generative operation, with reported EBITDA of $279m in H125. The mine is located in one of the most prolific silver districts in the world and significant exploration potential exists to extend known silver mineral reserves.
4. Record financial performance driven by commodity prices and M&A.
The company reported strong Q325 results driven by favourable commodity prices and the initial one-month contribution from Juanicipio, with record EBITDA of $406m and attributable operating cash flow of $324m. The silver segment all-in sustaining cost was down 22% on the previous quarter to an impressive $15.2/oz, in large part thanks to the strong cost performance at Juanicipio, which saw a negative all-in sustaining cost of $7.3/oz. Adjusted EPS grew 12 % to 48c and PAAS declared a quarterly dividend of 14c per share, up from 12c in the second quarter. It also revised its FY25 guidance for attributable silver production up to 22.0–22.5Moz and all-in sustaining cost down to $14.5–16.0/oz on the Juanicipio contribution. Gold production guidance remains at 735–800koz.
5. Strong earnings momentum supports shareholder returns.
Consensus expectations for FY25 are pointing to a stellar end to the year, with full-year EBITDA forecast to increase by c 50 % to $1.7bn and operating cash flows to improve 70% to $1.3bn. Market expectations remain very positive for FY26, with consensus EBITDA estimated to reach $2.7bn. The stock was up 156% in 2025, which still puts it on an undemanding enterprise value to EBITDA multiple of 8.6x for 2026. PAAS’s strong financial and share price performance is driven by the record-breaking silver and gold prices, improving operational momentum and M&A. The company maintains a robust liquidity position, with a consensus forecast of about $600m of net cash at end-2025. PAAS consistently distributes cash via regular dividend payments and share buybacks. Since 2010, it has returned over $1.2bn to shareholders.
Published 9 Jan 2026
