SP Angel has started coverage of junior miner Strategic Minerals PLC (LON:SML) with a punchy 1.31p price target, which could rise if a drilling programme in Cornwall is a success.
The broker says that Strategic is unusual for a junior in that cashflow from its tailings operation at Cobre New Mexico is sufficient to cover corporate costs while allowing it to explore new projects.
“The portfolio of both Australian nickel/cobalt and Cornish tin projects further diversifies the company’s risk profile from both a commodity and geographical perspective.
“The forthcoming drilling programme in Cornwall seeks to extend the vertical and lateral extent of the known deposit at Redmoor [tin and tungsten] and to upgrade the resource estimate from its current inferred status.
“A successful outcome to this programme provides potential uplift to our base case value estimate of £16.0m.”
Shares were up a touch to 0.76p.