Research Capital has repeated its ‘Buy’ rating on Mandalay Resources Corp as the company released more positive results from ongoing drilling at its Bjorkdal underground gold mine in Sweden.
In a note to clients, the analysts maintained its Buy rating and $5.75 per share target price, based on the continued use of a 1 multiple to the net asset value.
The analysts noted: “The company turned its attention to the Central Zone area and has drilled another 17 holes comprising 7,253 meters (m), resulting in the intersection of mineralization at least 350m from the current workings and the addition of 16 new veins to the 21 known ones.”
READ: Mandalay Resources hits some of the 'best grades seen at Björkdal' with recent drilling
They added that mineralization also remains open at depth and is said to be getting richer down plunge.
Research Capital analysts also noted that the drilling continues: “Visible gold and stacked veining remain distinguishing characteristics of the Bjorkdal system.
The buy rating and target prices are, the analysts said, “based on our long-term prices of US$1,850 per ounce (oz) gold and US$6,600 per tonne antimony (vs a reported Q4/21 average price of US$13,221/t). Our NAV(5%) includes US$125M for exploration upside.”
Mandalay Resources is a junior gold exploration and production company focused on Sweden and Australia. The company is currently operating one underground mine in each country having the potential to produce over 100,000 oz of combined production per year.
Contact Ritika at ritika@proactiveinvestors.com