Silver (SIN24) is a valuable metal widely used in various industrial applications, with the industrial sector accounting for half of total silver demand. Known for its exceptional electrical and thermal conductivity, silver is highly sought after by manufacturers of electrical appliances.
Additionally, silver is considered a global investment option alongside gold (GCM24) due to its status as a safe-haven metal and a hedge against inflation. As demand for silver is expected to increase, investors may want to diversify their portfolios by adding silver exposure through low-cost exchange-traded funds (ETFs) or investments in silver mining companies.
Vizsla Silver (VZLA), a Canadian mining company, stands out for its significant exposure to silver. With a market capitalization of $381 million, Vizsla Silver is focused on advancing its Panuco silver-gold project in Sinaloa, Mexico. Despite being a pre-revenue company, Vizsla Silver has delivered substantial returns to shareholders since its IPO in late 2019.
The company has conducted extensive drilling at Panuco, leading to the discovery of high-grade veins and aims to de-risk the resource base in the western region of the district. Vizsla Silver’s long-term growth strategy revolves around becoming one of the world’s largest single-asset silver primary producers through the exploration and development of the Panuco district.
According to Vizsla Silver, industrial demand for silver is projected to rise significantly in the coming years, driven by sectors like solar energy and electric vehicles. The company expects a substantial increase in silver demand over the next decade, with a growing market deficit due to stagnant supply and rising industrial demand.
While valuing early-stage companies like Vizsla Silver based on revenue and earnings can be challenging, Wall Street analysts remain optimistic about the stock. Out of the seven analysts covering Vizsla Silver, five recommend a “strong buy” and two recommend a “moderate buy.” The mean target price for Vizsla Silver stock is $2.92, suggesting a potential upside of 82.5% from the current closing price.