"A recently published research report on TNR, written by Fundamental Research Corp, reckons fair value for the company at C$0.22 per share. The current price is significantly lower than half of that." (Alastair Ford)
“Since our initiating report in September 2023, TNR’s royalty projects have made significant progress,” the analysts wrote in a report. “TNR is up 40% since September 2023.” (Emily Jarvie)
TNR Gold has analysts bullish on near-term royalty potential from Ganfeng’s Mariana Lithium Project
TNR Gold Corp (TSX-V:TNR, OTC:TRRXF) could see royalty payments from Ganfeng Lithium’s Mariana Lithium Project in Argentina as soon as 2025, which is set to boost the stock significantly, analysts at Fundamental Research believe.
They awarded TNR Gold a ‘fair value’ target of C$0.24, representing an upside of almost 250% from its current share price of C$0.07.
“Since our initiating report in September 2023, TNR’s royalty projects have made significant progress,” the analysts wrote in a report. “TNR is up 40% since September 2023.”
The analysts see the commencement of lithium production at Mariana later this year as an upcoming catalyst for the 'buy-rated' stock.
TRN Gold holds a 1.35% net smelter return (NSR) royalty on the Mariana project.
“We are projecting annual royalty revenue of $1.4 million for TNR at current spot lithium prices,” they wrote.
In addition to its royalty on Ganfeng’s Mariana project, TNR Gold also holds a 0.36% NSR royalty on McEwen Copper’s Los Azules copper-gold project, also located in Argentina.
The project hosts a large, open-pittable copper deposit, with an updated resource estimate and feasibility study expected in early 2025.
The analysts noted that recent metallurgical tests returned higher copper recoveries of 76% compared to the 73% used in the 2023 Preliminary Economic Assessment. As a result, this raised the project’s after-tax net present value by 10% to US$2.9 billion, based on a copper price of US$3.75 per pound compared to the current spot price of US$4.54 per pound.
“We are projecting annual royalty revenue of $6 million from this project, using conservative copper prices,” the analysts wrote.
Further, TNR Gold is seeking a joint venture partner to advance the Shotgun project in Alaska to a preliminary economic assessment. This project hosts a small-to-medium-sized gold deposit with inferred resources of 0.71 million ounces at 1.06 grams per ton of gold.
“TNR offers exposure to gold (41%), copper (38%), and lithium (21%),” the analysts wrote, noting that gold and copper are trading near record highs.
“We are more bullish on gold stocks than the metal itself, with gold producer valuations averaging 17% lower compared to the past three instances when gold surpassed US$2,000 per ounce,” they wrote.
“In addition, we maintain a positive outlook on lithium stocks as we believe lithium prices have stabilized, and battery/EV manufacturers/miners are actively seeking stable/long-term supply sources.”
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