RE:Summary See Bottom for latest Sprott link and an opinion we all see at the very bottom.
03.28.21 Buy Maintained
Analyst Tom Gallo
TOM GALLO
Canaccord Genuity
3.7 star rating
$4.25
03.11.21 Buy Reiterated
Analyst Craig Stanley
CRAIG STANLEY
Raymond James
0.7 star rating
$3.50
02.02.21 Buy Maintained
Analyst Ovais Habib
OVAIS HABIB
Scotiabank
3.5 star rating
$3.25
02.02.21 Buy Maintained
Analyst Alex Hunchak
ALEX HUNCHAK
CIBC
1.7 star rating
$4.00
01.04.21 Buy Maintained
Analyst Arun Lamba
ARUN LAMBA
TD Securities
3.6 star rating
$4.00
11.08.20 Buy Maintained
Analyst Barry Allan
BARRY ALLAN
Laurentian Bank of Canada
0.2 star rating
$4.80
10.24.20 Buy Maintained
Analyst Unknown Analyst
UNKNOWN ANALYST
National Bank
$3.00 follow
Brock Sailer Sprott $3.40
3.2021
https://www.sprott.com/media/3757/210330-scp-moz-dfs.pdf
Recommendation: maintain BUY rating, lift PT from C$3.30/sh to $3.40/sh We model the project per the DFS with identical C$600m NPV to Marathon (Table 3). From there, we simply lift CAD/USD to spot and lift gold to our LT US$1,850/oz assumption, which takes our NPV to C$932m.
To convert from asset NPV to group NAV, we deduct central SG&A and finance costs during the build, based on 65% gearing with 8% bank debt, lifting our asset NPV to C$950m with lower tax, netting off C$90m central and finance costs against that. We lift our FD share count from 262m to 274m in light of recent weaker ECM conditions in recent weeks.
We add 250koz @ US$200/oz for Berry (~half the Pit reserve Tonnes Grade Ounces Proven / M&I (0.7g/t cut-off) (000t) (g/t) (000oz) (%) Global reserves 47,060 1.35 2,050 68% D (%, to 2Q20) 15% -4% 10% Global resources 74,910 1.72 4,140 76% D (%, to 2Q20) 5% -2% 2% Source: Marathon 30 March 2021 Page 3 potential NPV) and add a nominal C$50m for FEP / belt upside. Adding cash and for ITM options and rolling our model forward a year takes our group NAV5%-1850 to C$1,155m as at 1Q23, or C$4.22/sh.
Maintaining a 0.8xNAV multiple to reflect time / permitting, build and finance risk to the downside, offset by scarcity value and M&A precedent to the upside, we maintain our BUY rating, lifting our PT from C$3.30/sh to C$3.40/sh.
We see ~1xNAV as very much achievable given the above scarcity value as the only >150koz pa open-pit-only free milling asset in our universe. With no narrow underground mining, no concentrate sales, no far-north, no wars, no terrorists, no sage grouse and no billion dollar capex, no rogue environment minister, no impenetrable jungle, we see this scarcity value as real, with fringe-benefit of M&A optionality. Table 4. (A) Undiluted SOTP asset valuation and (B) fully diluted for mine build group