URGENT UPDATE: Fresnillo’s shares have skyrocketed an astonishing 425% in 2025, significantly boosting investor returns. As speculation mounts about whether this momentum can continue into 2026, many are closely watching the market.
The surge is largely driven by Fresnillo’s robust silver portfolio, with annual production expected to reach around 50 million ounces in the coming years. The price of silver has surged 170% over the past year, now hovering around $75 an ounce, defying market predictions.
Why is this significant? The combination of heavy government spending and persistent budget deficits has prompted central banks to rethink their reserve holdings, shifting focus back to hard assets like silver. Unlike gold, silver benefits from dual demand: monetary use and essential industrial applications.
Currently, industrial applications account for approximately three-fifths of global silver consumption, driven by trends in solar energy, electronics, and electrification. This has created a perfect storm for silver demand.
Supply constraints amplify the situation. New mines typically take over a decade to develop, meaning any uptick in investment demand can lead to dramatic price increases. The limited availability of silver coupled with strong structural demand suggests a favorable outlook for Fresnillo.
For investors like Andrew Mackie, Fresnillo presents an attractive opportunity. Rather than owning physical silver, Mackie gains direct exposure through the stock, with production costs around $17 per ounce. This operational leverage has contributed to a remarkable 67% return in his Self-Invested Personal Pension (SIPP).
The business’s cash flow strengthens its balance sheet and supports further investments. Recently, Fresnillo announced a 225% increase in its interim dividend, with expectations for another substantial payout upon the release of its full-year results.
“This isn’t just about chasing a 425% gain; it’s about owning a scarce asset in a high-demand environment,” Mackie asserts.
However, investors should remain vigilant. Silver is known for its volatility, with prices capable of sharp pullbacks. Mining operations, especially in Mexico, face regulatory risks that could impact results.
With commodities being cyclical, prices that rise sharply can also fall just as quickly. Fresnillo’s exposure to both industrial and investment-driven demand means price fluctuations may be more pronounced.
For those with a long-term investment strategy, the current volatility can be managed within a SIPP. The focus should remain on the underlying demand drivers that support continued growth.
Bottom line: With the AI revolution driving electricity demand and the green transition still in its infancy, Fresnillo offers significant long-term potential. As the structural demand for silver remains intact, this stock could be poised for further gains in 2026. Investors should evaluate their positions carefully as these developments unfold.
Stay tuned for more updates on Fresnillo and other investment opportunities as the market evolves!
