PAAS Reports Record Cash Flow in Q3: A Sign for More Upside?

Pan American Silver Corp. PAAS reported a second consecutive quarter of record cash flow in the third quarter of 2025, indicating robust operational cash generation and disciplined capital spending.

A free cash flow of $252 million in the third quarter of 2025 pushed Pan American Silver’s cash and short-term investments balance to $910.8 million. This excludes the additional $86 million of cash generated from PAAS's 44% interest at Juanicipio post the MAG Silver acquisition. At the end of the third quarter of 2025, the company had working capital of $1.01 billion and $750 million available under its credit facility.

Since 2010, the company has returned about $1.2 billion to shareholders while investing in growth projects and maintaining a solid balance sheet. Backed by a strong cash flow generation, PAAS recently increased its quarterly dividend by 17% to 14 cents from the prior payment of 12 cents. This increase takes the company’s annualized dividend to 56 cents from the prior 48 cents.

Pan American Silver will pay the new quarterly dividend of 14 cents on Dec. 5, 2025, to shareholders of record as of Nov. 24, 2025. In comparison, its peers, Hecla Mining Company HL and First Majestic Silver Corp. AG, maintain an annual dividend of 0.02 cents.

The acquisition of MAG Silver in early September has positioned PAAS as one of the leading silver producers globally and significantly strengthened the company’s industry-leading silver reserve base. Pan American Silver gained a 44% stake in the Juanicipio project, which is a large-scale, high-grade silver mine in Zacatecas operated by Fresnillo plc. The Juanicipio mine is expected to generate free cash flow of around $200 million in 2025 on a 100% basis. This indicates an addition of $98 million to pro forma free cash flow in 2025.

Q3 Cash Flow Performance of Pan American Silver’s Peers

Hecla Mining achieved $90 million in free cash flow in the third quarter of 2025 with a cash balance of $133.9 million. The company reported cash from operating activities of $148.0 million, which remained flat sequentially due to unfavorable working capital changes of $37.8 million.

Like PAAS, First Majestic also achieved a record quarterly free cash flow in the third quarter. First Majestic’s cash flow increased 67.5% year over year to $98.8 million, with liquidity reaching $682 million. AG reported a record working capital of $542.4 million.

PAAS’ Price Performance, Valuation & Estimates

Year to date, PAAS shares have gained 76.3%, compared with the industry's 87.4% growth. In comparison, the Basic Materials sector has risen 11.6%, while the S&P 500 has moved up 14.7%.

PAAS is currently trading at a forward 12-month price-to-earnings multiple of 12.09X compared with the industry average of 14.69X.

The consensus mark for 2025 earnings is pegged at $2.14 per share, indicating a year-over-year surge of 170.9%. The estimate for 2026 of $3.37 indicates an increase of 57.6%.

The Zacks Consensus Estimate for Pan American Silver’s earnings for 2025 has moved up 9.7% over the past 60 days. The same for 2026 has moved up 38.1%.

PAAS stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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