If silver reaches $75/oz

🪙 Discovery Silver Corp (DSV / DSVSF) – 2025 Update

Latest verified info

• Shares Outstanding (basic): ~801 million shares. (Discovery Silver Corp.)
• Options: ~11 million; Warrants: ~4 million; Fully Diluted Shares: ~816 million. (Discovery Silver Corp.)
• AISC (Cordero FS): Average AISC of less than US$12.50/AgEq-oz for Years 1-8 of production in Cordero’s FS. (Discovery Silver Corp.)
• Latest operating AISC (gold operations after Porcupine acquisition): ~US$2,123/oz for Q2 2025 in gold-selling operations. (Discovery Silver Corp.)

⚠️ Risks

• Production cost risk: Even though Cordero’s FS shows very low AISC (~US$12.50/oz AgEq) early on, ramp-up zones, startup areas, or lower-grade areas often cost more. Real costs may exceed FS in early years or in less favourable zones.
• Metal price risk: The model’s higher valuations assume silver/gold/base metal prices well above current levels; if prices fall, the upside drops sharply.
• Permitting / environmental / community delays: Projects in Mexico (Cordero) still need permits, local infrastructure, environmental studies, and community agreements. Delays or objections could push timelines out.
• Dilution / financing risk: Big projects require large upfront spending; more shares or debt may be needed, which dilutes or raises cost of capital.
• Execution risk: Construction, metallurgy, logistics, and scaling up operations nearly always present unexpected challenges. Delivery of FS-assumed recoveries, grade, and throughput may lag or cost more.
• Portfolio complexity: With multiple assets (Cordero + gold from Porcupine etc.), maintaining focus and avoiding cost overruns across all becomes more difficult.

⚡ Catalysts

• Cordero Feasibility Study optimization / expansion (reducing costs, improving recoveries or scale) especially for Years 1-8 where cost is lowest.
• Continued drill results at Cordero to expand high-grade areas or improve resource outside the pit to extend mine life.
• Permit approvals and infrastructure development (roads, power, water) that reduce risk and capex.
• Strong metal price environment, especially silver and gold; also favorable lead/zinc prices if those by-products contribute.
• Financing or offtake or partnership agreements that help raise capital under good terms.
• Operational milestones from gold operations (Porcupine) to generate cash and reduce risk of overreliance on silver project.

📊 FCF Valuation (using FS cost, fully diluted shares = ~816 million)

Method: FCF ≈ production × (price − AISC). Assumptions:

• Use 37 million AgEq oz/year (from Cordero FS). (Discovery Silver Corp.)
• Use AISC = US$12.50/AgEq-oz (Years 1-8 FS average cost) as placeholder for lower bound; also run higher cost scenario to show sensitivity.
• Shares = 816 million fully diluted.

Scenario A: Silver = US$100/oz

• Margin/oz = 100 − 12.50 = US$87.50/oz
• Annual FCF = 37,000,000 × 87.50 = US$3,237.5M
• Valuation multiples:   • 10× → US$32.375B → per share ≈ US$39.65/sh   • 15× → US$48.562B → ≈ US$59.47/sh   • 20× → US$64.750B → ≈ US$79.30/sh

Scenario B: Silver = US$150/oz

• Margin/oz = 150 − 12.50 = US$137.50/oz
• Annual FCF = 37,000,000 × 137.50 = US$5,087.5M (~US$5.0875B)
• Valuation multiples:   • 10× → US$50.875B → per share ≈ US$62.38/sh   • 15× → US$76.313B → ≈ US$93.56/sh   • 20× → US$101.75B → ≈ US$124.75/sh

High-Cost Sensitivity Scenario: If AISC is higher (say US$30/oz) for early years or less favourable zones:

• At US$100 silver, margin = 100 − 30 = US$70 → Annual FCF = 37M × 70 = US$2.59B → 10× ≈ US$25.9B → per share ≈ US$31.75/sh
• At US$150 silver, margin = 150 − 30 = US$120 → Annual FCF = 37M × 120 = US$4.44B → 10× → US$44.4B → per share ≈ US$54.4/sh

📅 Expected Full Timeline (now → full production)

• H2 2025: Continue permitting, drill infills, finalize infrastructure and FS/capacity plans. Get closer to delivering cost guidance.
• 2026: Secure additional financing / capital; begin construction / procurement of major components; early production path mapping; engineering.
• 2027-2028: Ramp toward full production at Cordero (Years 1-8 cost profile); show cost metrics match FS; begin cash flow.
• 2029-2030: Extend mine life via resource expansions; refinance or optimize operations; full steady-state production under FS assumptions.

🎯 Updated Conclusion

✅ With fully diluted shares (~816M) and using very favorable FS cost (US$12.50/oz AgEq), Discovery Silver has a per-share fair value in the US$30-80/sh range under silver = US$100-150 depending on multiple.

✅ More conservative cost assumptions (e.g. US$30/oz AISC) pull that value down to US$25-55/sh range.

⚠️ Key factors to watch: actual cost performance (especially outside early years in FS), metal price environment, permitting / construction risks.

🚀 Overall, Discovery remains one of the stronger silver development plays if silver stays strong — good leverage, low cost first years, and relatively large shares base.