Source: The Gold Report 06/22/2017Once again analysts are talking about this British Columbia mining company that just announced its first gold pour.
In a June 21 press release, Pretium Resources Inc. (PVG:TSX; PVG:NYSE) announced its 100% owned Brucejack Mine had its first gold pour and "that the flotation and gravity circuits are now operational. In addition, gold-silver flotation concentrate is being produced and bagged, with initial shipments scheduled."
In a June 21 report, BMO Capital's Andrew Kaip followed up on his May 1 report by explaining that "the focus for PVG now turns towards the ramp-up to commercial production. We currently model commercial production at the end of Q3/17, but note that following the announcement, PVG could declare commercial production earlier than expected."
Kaip concluded by pointing out that "saleable shipments, even if for lower-grade material, will provide early-stage cash flow for the company. With Q2/17 results upcoming, financial reporting will provide an indication on how PVG is tracking towards its budget." He rates Pretium as an Outperform with a target price of $19.50.
Eric Zaunscherb, an analyst with Canaccord Genuity, stated in a June 21 report that the gold pour "is a major milestone for the company as it has been working diligently to bring the project into commercial production, a declaration expected in the back half of this year." Zaunscherb points out that in his May 1 report he highlighted "managements view that the production of gold concentrate and doré in the coming weeks was on track; this current announcement is in line with expectations."
Zaunscherb concludes "that the share-price dip of late is likely a good buying opportunity "and that "Pretium currently trades at a normalized P/NAV (5%) of 0.61x, a premium to covered development companies at 0.52x. In our opinion the premium is justified due to the project's scalability (exploration upside), low sovereign risk and the potential appeal as an M&A target." He maintains a Speculative Buy rating with a target price of $17.50.
In a May 17 interview with Gold Report, Louis James, editor of the International Speculator, highlighted that Pretium "is on the verge of pouring its first bar of gold" and pointed out that regardless of critics worried about Pretium's methods that the "bulk sample produced something like 60% more gold than was expected based on the model." He summarized "that the company was not being risky or cavalier; in fact, it was being conservative" and thought that "we're about to find out if I'm right."
Pretium is currently trading at around $9.39.
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( Companies Mentioned: PVG:TSX; PVG:NYSE, )
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