This is an updated version of the report published on January 29, 2026, at 09:11 AM GMT

Fresnillo PLC

Fresnillo PLC (LSE: FRES) is a FTSE 100-listed precious metals producer, operates a portfolio of high-performing silver and gold mines across Mexico. The company's flagship Fresnillo Mine in Zacatecas stands as one of the world's oldest and most productive silver operations. Complementing this asset, the modern Saucito mine in the same region delivers robust silver and gold output through advanced mining infrastructure. 

Key Recommendation Rationale – Sell at GBX 4,312.00

• Declining Year-on-Year Production Across Key Metals: Despite meeting or exceeding guidance, full-year production for silver, gold, and by-products declined compared to the prior year. Lower ore grades, reduced ore throughput, and the depletion or closure of certain mining areas (such as San Julián DOB and Noche Buena) continue to weigh on output, highlighting structural challenges in sustaining production levels.
• Operational Constraints and Grade Deterioration at Core Assets: Several major mines experienced lower grades, recovery rates, and processing volumes due to mine plan changes, equipment availability issues, maintenance shutdowns, and geotechnical challenges. These operational constraints have negatively impacted quarterly and annual performance and increase reliance on future mine development and optimisation to stabilise output.
• Weaker Outlook for Near-Term Production Growth: The 2026 guidance reflects lower expected silver and gold production versus prior years, driven by conservative grade assumptions, reduced throughput at key operations, and production being brought forward into 2025. This creates near-term growth headwinds and places greater dependence on medium-term projects and higher-grade areas to restore production momentum beyond 2026.

Valuation Methodology: Price/ Earnings Approach

Share Price Chart  

Conclusion

FRES is expected to trade at a discount, considering Weaker Outlook for Near-Term Production Growth. For conducting the valuation, the following peers have been considered – Greatland Resources Ltd (LSE: GGP), Antofagasta PLC (LSE: ANTO) and others.

Given its current trading levels, Declining Year-on-Year Production Across Key Metals, recent rally in the share price, and associated risks, it is prudent to exit the stock at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the current market price of GBX 4,312.00 on 29 January 2026 at 08:40 AM GMT.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 29 January 2026. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level which the stock is expected to reach as per the relative valuation method and/or technical analysis taking into consideration both short-term and long-term scenario.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the London Stock Exchange (LSE) and/or REFINITIV. Typically, both sources (LSE and or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.’

Note 6: Dividend Yield may vary as per the stock price movement.