Last Update08 Sep 25Fair value Increased 31%
Endeavour Silver (EDR.TO) Valuation & Outlook Report
📌 Company Overview
Endeavour Silver is a silver mining company engaged in the acquisition, exploration, development, extraction, processing, refining, and reclamation of mineral properties. Its core assets are located in Mexico, with additional projects in Peru, Chile, and the United States.
📊 Production & Assumptions
- Production Estimate (2025 onward): 9 million oz annually (post-Terronera).
- AISC (post-Terronera): ~$20/oz.
- Shares Outstanding: ~290 million (latest filings).
- Valuation Basis: Free Cash Flow (FCF) × multiple.
- Multiples Used: 10× (conservative), 15× (bull avg), 20× (bull peak).
- FX Assumption: 1 USD ≈ 1.36 CAD.
⚡ Catalysts
- Terronera Mine (2025–2026): Ramp-up from commissioning to full commercial production will drive step-change in revenue and cash flow.
- Kolpa Mine Expansion: Potential increase to 2,500 tpd capacity in 2026, boosting leverage to silver prices.
- Exploration Upside: Resource growth at Kolpa and Pitarrilla supports longer mine life and higher output.
- Silver Demand: Renewables (solar, EVs) are accelerating structural demand.
- Margin Expansion: Industry-wide silver supply deficits + optimized recoveries = higher profitability.
🔎 Analyst Expectations (2025–2028)
- Revenue Growth: +41.7% annually (3-yr CAGR).
- Margins: Improve from -28.1% → 22.1%.
- Earnings: -$69.6M → $155.6M by 2028 (EPS ~$0.54).
- PE Ratio: ~18.4× on 2028 earnings.
- Share Dilution: +7% annually.
- Consensus Price Target: CA$9.17 (range CA$7.5–10).
⚠️ Risks
- Terronera Ramp-Up: Commissioning delays, lower recoveries, or cost overruns.
- Liquidity Strain: Negative working capital, net losses (e.g., -$20M in Q2 2025).
- Kolpa Integration: Higher operating costs, uncertain synergies.
- Expansion Projects: Subject to permits, regulatory approvals, and capex overruns.
- Geographic Concentration: Heavy reliance on Mexico/Peru with political & ESG risks.
🎯 Key Takeaways
- Strong Upside Leverage: At silver $100–150/oz, Endeavour could re-rate to $25–40 USD/share conservatively, and $50–80+ USD/share in a bull market re-rating.
- Analyst Base Case: Near-term fair value seen at ~CA$9 (little upside from today).
- Your Model vs Analysts: Analysts assume ~$25–30/oz silver long-term; your $100–150/oz scenarios show extreme upside.
- Risk/Reward: Execution at Terronera + silver price trajectory are the main swing factors.
📈 Valuation Scenarios
Silver @ $100/oz
- Revenue: $900M
- Costs: $180M
- FCF: $720M
- Market Cap @ 10×: $7.2B
- Stock Price: $24.8 USD / $33.8 CAD
Silver @ $150/oz
- Revenue: $1.35B
- Costs: $180M
- FCF: $1.17B
- Market Cap @ 10×: $11.7B
- Stock Price: $40.3 USD / $54.9 CAD
- At 15× multiple: $60.5 USD / $82.3 CAD
- At 20× multiple: $80.7 USD / $109.2 CAD
Endeavour Silver (EDR.TO) Valuation Scenario
Assumptions
- Production Estimate: 9 million oz annually starting in 2025
- Price of Silver: $100 per oz
- All-in Sustaining Costs (AISC): $20 per oz (post-Terronera)
- Valuation Multiple: 10× free cash flow (FCF)
Revenue & Cost Calculation
1. Annual Revenue Revenue = Production × Price per oz Revenue = 9,000,000 × 100 = $900,000,000 USD
2. Annual Costs Costs = Production × AISC Costs = 9,000,000 × 20 = $180,000,000 USD
3. Annual Free Cash Flow (FCF) FCF = Revenue – Costs FCF = 900,000,000 – 180,000,000 = $720,000,000 USD
Market Cap Valuation
Market Cap = FCF × Multiple Market Cap = 720,000,000 × 10 = $7,200,000,000 USD
Shares Outstanding (Old Assumption)
Shares Outstanding = 140,000,000 (approximate, older figure)
Stock Price = Market Cap ÷ Shares Outstanding Stock Price = 7,200,000,000 ÷ 140,000,000 = $51.43 USD/share
Conclusion
At $100 silver, Endeavour Silver could trade around $51.43 per share (based on the older assumption of 140M shares).
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Disclaimer
The user RockeTeller has a position in TSX:EDR. Simply Wall St has no position in any of the companies mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The author of this narrative is not affiliated with, nor authorised by Simply Wall St as a sub-authorised representative. This narrative is general in nature and explores scenarios and estimates created by the author. The narrative does not reflect the opinions of Simply Wall St, and the views expressed are the opinion of the author alone, acting on their own behalf. These scenarios are not indicative of the company's future performance and are exploratory in the ideas they cover. The fair value estimates are estimations only, and does not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that the author's analysis may not factor in the latest price-sensitive company announcements or qualitative material.
