TSXV:PEM.P - Post by User
Post by
monkey3Don Oct 13, 2011 11:19pm
306 Views
Post# 19147979
This Hope Work last NO work
This Hope Work last NO workSPECULATIVE BUY 12 MONTH TARGET: C$1.15 VALIDATING THE MAIN ZONE AT FRIDAY
EVENT
Premium released 4 drill results at its Friday-Petsite deposit as it greatly extends the Main Zone to the South.
FINDING THE FRIDAY FAULT
As with most of the Phase 4 drilling campaign, the drilling focused on improving PEM’sunderstanding of the fault past the Main Zone. Therefore drilling has been completed inverted to the mineralization and, consequently, intercepts are much narrower (see Appendix). Drilling was completed much closer to the fault also limiting the width of the gold mineralization.
SOUTH ZONE OVERLAP
With the release of drill holes PFR2011_11 to PFR2011_14, PEM now has drill results that overlap the entirety of the South Zone (data on South Zone was mostly compiled from historical results). Importantly, the drill holes intercepted mineralization below the South Zone block. As with holes PFR2011_7 and _9, the host rock lithologies and alterations are very similar to the Main Zone. We now believe that PEM has successfully tied all three zones together to form a uniform block (see figure 1).
Figure 1: Drill Hole Map of Friday Deposit
With the increased strike length of the Main Zone now overlapping the South Zone, we have renewed confidence in PEM’s objective of discovering a large scale deposit. Based on the consistency of the extensions, we believe some holes will be included in a future resource estimate. As stated in our July 21 Company Update, PEM may be able to increase its Friday deposit to nearly 2M oz Au even with relatively limited drilling. If this were the case, PEM would be valued at only 10$/oz in the ground (a steep discount to its peers even with current market turbulence).RECOMMENDATION
PEM has been continuously successful in its drilling at Friday-Petsite. Every hole drilled has found the Friday fault as well as mineralization. As PEM meets our exploration targets, we reiterate our Speculative Buy recommendation and the12 month target price of C$1.15.
Premium Exploration Inc. ("Premium" or "the Company") is a junior mineral exploration and development company with gold, silver, platinum and palladium assets in Idaho and Montana. The Company’s current focus is on the advancement of Premium’s Idaho Gold Project, located in north-central Idaho. The project is host to numerous mineralized zones and exploration targets with the potential to host several million ounces of gold.
Source: Stockcharts
Main Zone
South Zone
Source: Company FilingsPremium Exploration Inc.(TSX-V: PEM) October 4, 2011 2 of 4 2 of 4 Killian Charles
2 of 4
Source: Company Filings
Source: Company Filings
Source: Company Filings
APPENDIX: DRILLING THE FAULT VS MINERALIZATION
From Press Release dated July 19th, 2011 (drilling for mineralization)From Press Release dated October 3rd, 2011(drilling for the Friday Fault)PFR_2011_13 and _14 PFR_2011_11 and _12 Premium Exploration Inc.(TSX-V: PEM) October 4, 2011 3 of 4 3 of 4 Killian Charles Legal Disclosure
Investment Recommendation Rating System
Top Pick: The stock represents our best investment ideas, the greatest potential value appreciation.
3 of 4
Strong Buy: The stock is expected to deliver a return exceeding 13% over the next 12 months.Buy: The stock is expected to deliver a return between 9% and 13% over the next 12 months.
Hold: The stock is expected to deliver a return between 5% and 9% over the next 12 months.
Sell: The stock is expected to deliver a return lower than 5% over the next 12 months.
Speculative Buy: Stock bears significantly higher risk that typically cannot be valued by normal fundamental criteria. Investment in the stock may result in material loss.
Distribution of Ratings, as of September 30th, 2011 Rating | Coverage Universe |
Top Pick | 4% |
Strong Buy | 39% |
Buy | 14% |
Speculative Buy | 18% |
Hold | 0% |
Tender | 0% |
Not Rated | 25% |
Sell | 0% |
100% |