Lion One Metals Ltd. (LIO:TSX.V; LOMLF:OTCQX; LLO:ASX) has announced significant new high-grade drilling results as mechanized production has commenced at its Tuvatu gold mine in Fiji. Find out why one analyst says it's undervalued and on the verge of breaking out.
Lion One Metals Ltd. (LIO:TSX.V; LOMLF:OTCQX; LLO:ASX) announced significant new high-grade drilling results while mechanized production began at its Tuvatu gold mine in Fiji, a style of mining that has yet to take place in this island nation.
The company released assay results from nearly 5,000 meters of new drilling in 36 holes in Zone 5. Highlights included 393.01 grams per tonne gold (g/t Au) over 1.2 meters , including 1,568.55 g/t Au over 0.3 meters, 215.86 g/t Au over 0.6 meters and 49.85 g/t Au over 1.2 meters, including 63.35 g. /t Au over 0.3 meters.
Lion One said the first remote bog shoot in Tuvatu occurred on May 16 and the first long-hole stop shot took place on May 18, both firsts for the country of Fiji, the company said. Company.
“This is a major milestone for the Company as it represents the transition from primarily development mining to primarily production mining,” the company said in a statement.
Last month, Technical analyst Clive Maund wrote that the stock “was and is” undervalued. He said he was long on Lion One and rated it a strong buy for all time frames.
“It is undervalued and undervalued here with potential for additional discovery,” he wrote. “Its revaluation potential will likely be significantly increased by the continuation and acceleration of the major bull market in the precious metals sector that has just begun.”
The catalyst: explored targets ready to be exploited
Lion One said all assay results released Thursday were “proximal to underground development in the near-surface portion of the mine.”
Last month, technical analyst Clive Maund wrote that the stock “was and is” undervalued. He said he was long on Lion One and rated it a strong buy for all time frames.
Drilling was focused north and south of the Cabex Fault, which is a deposit-scale structure scarred by carbonate. The primary targets for these drill holes were the down-dip and southward extensions of the UR2 and URW3 veins, which are expected to be mined over the next 12 months.
The Cabex Fault is a post-mineralization fault that trends approximately east-southeast and dips approximately 65 degrees to the south-southwest, the company said. It is interpreted to be a late caldera collapse structure that is healed with carbonate. The objective of the Zone 5 infill drilling and grade monitoring program is to improve the mine model and inform stope design prior to mining.
Lion One also noted that the Tuvatu processing plant can now sustainably process more than 400 tonnes per day (tpd), which is higher than the plant's rated capacity of 300 tpd. The increase in throughput is possible thanks to operational improvements and debottlenecking initiatives carried out by the plant team.
Gold Bull Market: Miners Should Benefit
Gold price hits new all-time high at US$2,449.89 per ounce May 20but had stabilized at US$2,358.76 on Thursday.
Some are predicting a prolonged and substantial bull market in gold. Adam Rozencwajg, managing partner at Goehring & Rozencwajg, predicted that prices could reach US$5,000 to US$7,000 per ounce before it's all over.
A recent report from global investment bank UBS raised its gold price forecast to US$2,800 per ounce by the end of 2025 due to persistent demand driven by macroeconomic uncertainty, risks geopolitics and the increase in safe haven allocations. Reported Mining Flows.
The site says UBS also upgraded several gold mining stocks to “Buy” and increased its target prices.
“While central banks are increasing their gold purchases and investors are yet to fully commit to gold, the outlook for the precious metal remains optimistic, with prices expected to reach new highs by 2025 if UBS's analysis is maintained over the next 18 months,” the site notes. “As the mining industry now focuses on growth and cost optimization, shares of gold mining companies are also expected to benefit from these market conditions.”
Research firm Metals Focus predicted that a possible easing of monetary policy by the Federal Reserve would push gold prices further higher later this year, Kitco reported Thursday.
“Later this year we expect prices to rise again, likely hitting a new all-time high,” said Neil Meader, director of gold and silver at Metals Focus, according to Kitco. “After all, the recent peak of $2,450 (US) is lower, in real terms, than in 1980, which would have been around $3,000 (US) at today's prices.”
Ownership and structure of shares
Reuters provided a breakdown of the company's ownership and share structure, where management and insiders own approximately 9.21% of the company.
According to Reuters, Chairman and CEO Walter H. Berukoff owns 9.06%, Director Kevin Puil owns 0.08%, CFA Tony Young owns 0.04%, and Director Richard J. Meli owns 0%. .02%.
Reuters reports that institutional investors own 5.34% of the company, Franklin Advisers, Inc. owns 4.58%, Aegis Financial Corporation owns 0.51%, and US Global Investors Inc. owns 0.22%.
According to Reuters, there are 230.55 million shares outstanding and 209.32 million floating shares traded, while the company has a market capitalization of 133.72 million Canadian dollars and trades over a period of 52 weeks between 0.38 and 1.04 Canadian dollars.
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