From the Globe this morning Solaris Resources Inc. (
) is “warranting an extra look,” according to RBC Dominion Securities analyst Alexander Jackson.
He initiated coverage of the Vancouver-based miner with an “outperform” rating on Monday, calling its flagship Warintza project in Ecudador “a top-tier, open-pit, development-stage copper asset given its shallow, high-grade mineralization, close proximity to infrastructure and its meaningful scale with potential for expansion.”
Mr. Jackson sees both the project and company having “strong take-out potential” and expects Solaris shares to “benefit from continued exploration of the highly prospective land package.”
“The project is particularly attractive given the medium- and long-term outlook for copper, and the current state of commodity markets, which has resulted in strong balance sheets and free cash flow generation for miners,” he said. Solaris is well funded with $69-million in cash at the end of Q1/21, which we expect to be adequate to finance exploration and development through to the completion of the preliminary economic assessment (“PEA”) on the Central deposit.”
“The Warintza project has a historical initial resource based on minimal exploration done in 2000 & 2001. The current strategy is to grow the resource at the Central deposit to support a PEA that demonstrates strong economics and meaningful scale of the project, while also generating value through the drill bit with exploration results showing the potential for resource estimates at the Warintza East, Warintza South and Yawi deposits. Solaris is in the exploration and discovery phase of the lifecycle of a mining company, in our view, with the Warintza Project. We expect the shares to re-rate higher as Solaris uncovers the potential of the Warintza land package through further successful exploration drilling and with the delivery of a PEA next year.”
Seeing its shares trading at a discount to similar developing copper projects and producers, he set a Street-high target of $18 per share, exceeding the average of $13.49.
SOLARIS RESOURCES INC
11.20+5.12 (84.21%)
YEAR TO DATE