Analysts at Fundamental Research have repeated their ‘Buy’ rating on Power Nickel Inc (TSX-V:PNPN, OTCQB:PNPNF) following the discovery of the high-grade polymetallic Lion Zone at its Nisk nickel-copper-platinum group metals project in Quebec.
Since their last report in January, Power Nickel stock has surged 170% on the discovery.
The Nisk project hosts two primary mineralization zones, the nickel-rich Nisk Main deposit and the polymetallic Lion Zone, located 5.5 kilometers from the Nisk Main deposit. The Lion Zone was uncovered earlier this year through a drill program which followed up on a discovery hole.
“Through this drill program, Power Nickel has transformed from a nickel junior to a polymetallic play,” Fundamental Research analysts wrote in a note to clients.
“We believe initial results indicate potential for a high-grade, mid-sized deposit at the Lion Zone, with high copper, gold, silver, and platinum group metals grades akin to world-class Norilsk deposits in Russia.”
Based on their review of the drill results, analysts believe the deposit could host up to 1 billion pounds of high-grade copper equivalent.
Meanwhile, the Nisk Main deposit hosts a medium-sized, high-grade resource of 178 million pounds of nickel equivalent.
“We believe the project has significant resource upside potential, as mineralization at both Nisk Main and Lion remain open in multiple directions,” analysts wrote. “In addition, several targets remain untested. An 8,000 m drill program is underway.”
Upcoming catalysts for the company include resource delineation and expansion drilling, a feasibility study, and positive sentiment towards juniors focused on electric vehicle metals.
“Despite the recent slowdown in EV sales growth, the long-term outlook for EVs remains robust. Battery and EV manufacturers, along with miners, are actively seeking stable and long-term supply sources of EV metals,” they noted.
The analysts also awarded the stock a Fair Value of C$1.17, implying upside of about 100% from Power Nickel’s share price at the time of writing.