Troilus Gold Corp (TSX:TLG, OTCQX:CHXMF) has earned a repeat ‘Buy’ rating and price target of C$2.50 from analysts at Laurentian Bank Securities Equity Research after the junior miner announced positive assay results from Zone X22 at its Troilus gold project in Quebec.
Troilus’ Toronto-listed shares are currently trading at about C$0.65.
In a note to clients, the analysts highlighted that the strike length of the X22 Zone has now grown to 800 metres (m), from 300m, and has continued to demonstrate zone continuity, relatively shallow depth, and favourable grades.
READ: Troilus Gold says drilling at Zone X22 extends strike length to more than 800m
The mineralization closer to the surface tended to have grades consistent with the project average, with higher-grade intervals starting at a vertical depth of 125m to 150m, they added.
They wrote that Troilus will continue to delineate X22 and the higher-grade Connector Zone over the coming months for inclusion in a Feasibility Study expected in the second half of 2023.
“The expectation is that these higher-grade zones might factor into the early years of the mine life and have a positive impact on the grade profile,” they wrote.
The analysts noted that they continue to expect that mine sequencing early in the envisioned mine life will be sourced from the Southwest Zone, supplemented by these two higher-grade zones.
“Our valuation excludes any benefit from these high-grade zones as we await the other key model inputs from the Feasibility Study,” they concluded.
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