Industrial Alliance Securities initiated coverage of GT Gold Corp. (TSXV:GTT) shares recently with a “buy” rating and a $3 target price
SmallCapPower | May 15, 2020: GT Gold Corp. (TSXV:GTT) shares have enjoyed some nice upward momentum this year. GTT stock has appreciated 29% over the past month, to its current price of $1.61, with a year-to-date return of 52%.
On Tuesday, Industrial Alliance Securities analyst George Topping initiated coverage of GT Gold with a “buy” rating and a $3 target price, seeing the stock as “cheap and undervalued” ahead of upcoming key market catalysts.
GT Gold is a junior gold, silver, and copper explored focused in northern BC’s prolific Golden Triangle region. The Company’s flagship property is the Tatogga property, covering an area of 46,826.73 hectares.
“Jurisdictionally, the Company is located in a top tier location inside the more accessible area of the Golden Triangle in B.C., well served by infrastructure and a mining friendly First Nations community,” Mr. Topping said. “Porphyry Au-Cu deposits are some of the largest scale mines in the world and Saddle North is shaping up to be of similar scale or better but still well underexplored along the 3km anomaly. Saddle South’s high-grade Au-Ag veins add to the upside of what could be a full complex one day.
“After years of curtailed exploration, there aren’t enough sizeable, shovel ready, predominantly gold deposits to go around, thus producers will turn/are increasingly turning to Au-Cu style deposits for their copper kicker, multi-cycle life, and scalability.”
The Industrial Alliance Securities analyst sees GT Gold as a takeover target, with Newmont Corp being the likely suitor as the gold mining giant has a more than 15% equity stake in GTT, adding that mining titan Ross Beaty also owns 9% of GT Gold.
Mr. Topping added: “Although Newmont owns a Right of First Offer (ROFO) on the Tatogga property, we would expect other senior producers to make it competitive. Newcrest owns 70 per cent of the Red Chris mine next door. Most senior gold producers appreciate gold/copper porphyries as the copper provides lower AISC [all-in sustaining cost] and copper-related cash flow still garners a gold multiple.”
George Topping says key catalysts for GT Gold Corp. include an inaugural inferred resource estimate (expected by mid 2020) and Preliminary Economic Assessment (PEA) (expected by year end).
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