A ROTH Capital Partners report discussed this
precious metals company's updated resource and the potential for its
expansion.
In a Sept. 19 research note, analyst Jake Sekelsky reported SilverCrest
Metals Inc.'s (SIL:TSX.V) updated resource estimate at Las Chispas
"exceeds our expectations," and that ROTH raised its target price
on the Buy-rated company to CA$5.50 per share from CA$4.50. The stock is
trading at around CA$3.15 per share.
"We are particularly impressed with the growth in high-grade
resources that we believe should have a strong impact on production early in
the mine life," Sekelsky wrote.
The new Las Chispas resource estimate totals 86.7 million ounces (86.7
Moz) of silver equivalent (Ag eq), relayed Sekelsky, encompassing 4.3 million
tons of gold and silver. This reflects a 38% increase over the size of the
maiden resource, which was 62.8 Moz, and exceeds ROTH's estimate of 80 Moz.
The gold grade is 3.68 grams per ton (3.68 g/t) and the silver grade, 347
g/t silver. The grade together as Ag eq is 623 g/t. With the resource update,
the high-grade portion of the resource grew 75% to 56.3 Moz from 32.2 Moz and
was the catalyst for ROTH's target price increase on SilverCrest.
"Investors should remain focused on the high-grade portion of the
resource," Sekelsky noted. "We are increasing our forecast for
high-grade production at Las Chispas from the first two years of production
to the first four years of production."
In addition, indicated Sekelsky, further upside exists at Las Chispas,
where 22 identified veins "should support continued growth in the
company's resource base." SilverCrest intends to continue drilling
there, with six to eight rigs, through H2/18.
ROTH estimated these exploration efforts could lead to another 25%
increase in silver equivalent ounces at Las Chispas, for about a 110 Moz
total, Sekelsky pointed out. Such growth could support another resource
update, then a positive preliminary economic assessment, both of which are
expected in H1/19. Catalysts in the meantime will be additional drill results
from the project.
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Disclosures from ROTH Capital Partners, SilverCrest Metals, Company
Note, Sept. 19, 2018
Regulation Analyst Certification ("Reg AC"): The research
analyst primarily responsible for the content of this report certifies the
following under Reg AC: I hereby certify that all views expressed in this
report accurately reflect my personal views about the subject company or
companies and its or their securities. I also certify that no part of my
compensation was, is or will be, directly or indirectly, related to the
specific recommendations or views expressed in this report.
Shares of SilverCrest Metals may be subject to the Securities and
Exchange Commission's Penny Stock Rules, which may set forth sales practice
requirements for certain low-priced securities.
ROTH Capital Partners, LLC expects to receive or intends to seek compensation
for investment banking or other business relationships with the covered
companies mentioned in this report in the next three months.
