Assessing Avino Silver & Gold Mines (TSX:ASM) Valuation After La Preciosa Drill Success and Q3 Earnings Beat

Avino Silver & Gold Mines (TSX:ASM) has caught investors attention after confirming high grade silver hits from new La Preciosa drill holes and delivering a Q3 earnings beat that helped push shares to fresh highs.

See our latest analysis for Avino Silver & Gold Mines.

Those La Preciosa drill results and the recent earnings surprise have landed on top of an already powerful run, with a year to date share price return above 500 percent and a three year total shareholder return close to 900 percent, suggesting momentum is still firmly building rather than fading.

If Avino’s surge has you rethinking what else could move this hard, now is a good time to broaden your search and discover fast growing stocks with high insider ownership.

With the share price now far above analyst targets but traditional valuation metrics still flagging a sizable intrinsic discount, is Avino starting to look stretched, or is the market only beginning to price in its growth potential?

Most Popular Narrative: 75% Overvalued

With Avino Silver & Gold Mines last closing at CA$9.26 against a narrative fair value of roughly CA$5.30, expectations look far richer than the modeled future cash flows.

The analysts have a consensus price target of CA$5.225 for Avino Silver & Gold Mines based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of CA$6.2, and the most bearish reporting a price target of just CA$4.25.

Read the complete narrative.

Want to see why strong growth forecasts still point to a lower value than today’s price? The narrative leans on aggressive margin expansion, rapid earnings compounding and a carefully chosen discount rate. Curious how those moving parts interact to pull the fair value well below the market price?

Result: Fair Value of $5.30 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, sustained cost efficiencies and successful La Preciosa ramp up could unlock stronger margins and cash flows than conservative models currently allow for.

Find out about the key risks to this Avino Silver & Gold Mines narrative.

Another Lens on Value

Analysts see Avino as about 75 percent overvalued versus their CA$5.30 fair value, but our SWS DCF model points the other way, suggesting the shares trade roughly 61 percent below intrinsic value. When one framework indicates expensive and another signals cheap, which story do you trust?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Avino Silver & Gold Mines for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 904 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Avino Silver & Gold Mines Narrative

If you look at the numbers differently or want to dig into the assumptions yourself, you can quickly craft a personalized view in under three minutes, Do it your way.

A great starting point for your Avino Silver & Gold Mines research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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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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