Is Avino Silver & Gold Mines (TSX:ASM) Pricing In Its Recent 115.7% One-Year Share Price Surge?

• If you are wondering whether Avino Silver & Gold Mines is still attractively priced after a strong run, a good starting point is to look closely at what the current share price implies about its value.
• The stock closed at US$9.06, with the share price up 11.7% year to date, very large gains over the past 3 years, and a 115.7% return over the last year. However, it has fallen 7.6% over the past week and 9.4% over the past month.
• Recent coverage has focused on Avino as a silver and gold producer listed in Canada and the US, with attention on how its operations and assets line up against peers in the precious metals space. This context helps explain why investors have been reassessing both the upside potential and the risks around the stock price.
• Even with that backdrop, Avino’s current valuation score sits at 2 out of 6. This raises questions about which methods suggest value and which do not, and sets up a closer look at standard valuation approaches and a more complete way to think about what the stock might be worth by the end of this article.

Avino Silver & Gold Mines scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Avino Silver & Gold Mines Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow model estimates what a stock could be worth by projecting future cash flows and then discounting them back to today’s value using a required rate of return.

For Avino Silver & Gold Mines, the model used is a 2 Stage Free Cash Flow to Equity approach based on cash flow projections. The latest twelve month Free Cash Flow is $20.43 million. Simply Wall St then projects Free Cash Flow out to 2035, with 10 year forecasts ranging from $31.15 million in 2026 to $108.21 million in 2035, and discounts each year back to today in dollars.

Adding these discounted cash flows together and including a terminal value produces an estimated intrinsic value of $13.15 per share. Against the recent share price of US$9.06, this implies the stock trades at a 31.1% discount, which suggests undervaluation on this metric alone.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Avino Silver & Gold Mines is undervalued by 31.1%. Track this in your watchlist or portfolio, or discover 9 more high quality undervalued stocks.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Avino Silver & Gold Mines.

Approach 2: Avino Silver & Gold Mines Price vs Earnings

For a profitable company, the P/E ratio is a useful way to think about what you are paying for each dollar of earnings, which makes it a straightforward cross check on the DCF result you have just seen.

What counts as a “normal” P/E depends on how the market views a company’s growth potential and risk profile. Higher expected growth or lower perceived risk often lines up with a higher P/E, while slower expected growth or higher risk tends to go with a lower P/E.

Avino Silver & Gold Mines currently trades on a P/E of 30.2x. That sits above the Metals and Mining industry average of 16.2x and also above the peer average of 22.5x, so on simple comparisons the stock looks expensive relative to many listed metals and mining companies.

Simply Wall St’s Fair Ratio for Avino is 22.7x. This proprietary metric estimates what P/E might be reasonable after accounting for factors such as the company’s earnings growth profile, profit margins, size, risk characteristics and its industry. Because it blends these elements, it can be more tailored than a basic comparison with industry averages or a broad peer group.

Comparing the Fair Ratio of 22.7x with the actual P/E of 30.2x suggests the stock trades above this fair value range.

Result: OVERVALUED

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Upgrade Your Decision Making: Choose your Avino Silver & Gold Mines Narrative

Earlier it was mentioned that there is an even better way to understand valuation. Narratives are introduced here as a simple way for you to attach a clear story about Avino Silver & Gold Mines to the numbers you care about, by linking your view on future revenue, earnings and margins to a fair value estimate that can be compared with today’s share price on Simply Wall St’s Community page. On that page, Narratives are updated when new news or earnings arrive, and different investors can set very different fair values. For example, there may be a highly optimistic scenario that points to around $89.00 per share in a 2028 silver bull case, versus more cautious analyst targets closer to CA$4.25, CA$9.00 or CA$15.70. This helps you quickly see which story you believe and whether the current price fits the Narrative you choose.

For Avino Silver & Gold Mines, however, we will make it really easy for you with previews of two leading Avino Silver & Gold Mines Narratives:

Start by asking which story fits your assumptions about silver prices, production growth and project execution, then compare that with where the stock actually trades today.

🐂 Avino Silver & Gold Mines Bull Case

Fair value in this bullish narrative: US$89.00 per share.

Implied discount to this fair value at US$9.06: about 90% below the narrative fair value.

Revenue growth assumption used in the model: 137.49%.

• Assumes Avino reaches 7,000,000 silver equivalent ounces of annual production with silver at US$100 per ounce by 2028.
• Uses a low all in sustaining cost assumption of US$30 per ounce to arrive at sizeable free cash flow and a multi billion dollar equity value at 10x FCF.
• Maps out upside scenarios where higher silver prices and successful project ramp up lift the stock into a very high per share value range, while also flagging execution, cost, permitting and funding risks.

🐻 Avino Silver & Gold Mines Bear Case

Fair value in this more cautious narrative: CA$9.00 per share.

Implied premium to this fair value at US$9.06: depends on FX, but the current price sits close to the CA$9.00 narrative level, so it points to limited upside on these assumptions.

Revenue growth assumption used in the model: 28.94%.

• Emphasises that expectations for demand, pricing power and project expansion may already be reflected in the share price, while rising costs and single region exposure in Mexico could pressure future profitability.
• Builds a fair value around analysts expecting revenue to reach US$197.7 million and earnings of US$70.6 million by about 2029, with profit margins rising into the mid 30% range and a future P/E of 24.0x.
• Highlights that consensus targets cluster around CA$9.00, with a wide spread between bullish and bearish analyst views, and encourages you to sense check those inputs against your own expectations for silver prices, project delivery and cost trends.

If you want to see how other investors are joining the dots between these stories and the current price, you can review the full range of community views and valuation models for Avino on Simply Wall St, and then decide which assumptions you are most comfortable using for your own decision.

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Avino Silver & Gold Mines on Simply Wall St. Add the company to your watchlist or portfolio so you’ll be alerted when the story evolves.

Do you think there’s more to the story for Avino Silver & Gold Mines? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.

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