MAG Silver CorpRegaining some lustre. Shares of MAG Silver rebounded Friday after what Canaccord Adams Senior Mining Analyst Eric Zaunscherb called an overdone correction created by heavy selling on Wednesday and Thursday. Last Wednesday, MAG issued a release correcting the independent resource estimates announced February 24. Both resource estimates were prepared by Scott Wilson Roscoe Postle Associates for the Valdecañas vein on the 44%-owned Juanicipio silver project in Zacatecas, Mexico.
After the release MAG’s share price fell to an intraday low of $4.87 (-14%) on Thursday recovering to close at $5.04 per share.
Although the release of the adjusted resource and the subsequent market correction were negative events, the resultant share price is below the US$4.54 per share cash offer proposed by senior partner Fresnillo. Zaunscherb believes the price adjustment post the correction is overdone, which creates an opportunity for investors. With the bid by Fresnillo now being more relevant, MAG shares trading at a discount rather than the 43% premium at the intraday high of US$6.49 on February 9, Zaunscherb notes that he continues to believe that Fresnillo is highly motivated to acquire its junior partner’s interest in the Juanicipio project, a reflection of the quality of this high-grade silver project and its highly prospective nature. Additionally, Zaunscherb expects important catalysts including incremental exploration results and a pre-scoping study over the next few weeks, which may have dramatic impacts on the market.
For full Analyst Report on MAG Silver please see:
https://www.bullionbullscanada.com/index.php?option=com_content&view=category&id=55&Itemid=110
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