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Original-Research: West Mining Corp. - von Sphene Capital GmbH

Einstufung von Sphene Capital GmbH zu West Mining Corp.

Unternehmen: West Mining Corp.
ISIN: CA9546061099

Anlass der Studie: Update Report
Empfehlung: Buy
seit: 11.02.2022
Kursziel: CAD 0,88 (unverändert)
Kursziel auf Sicht von: 36 Monate
Letzte Ratingänderung: -
Analyst: Peter Thilo Hasler, CEFA

Acquisition of a new property with multiple copper showings
 
We confirm our price target of CAD 0.88 and our long-term (36 months) Buy
rating for the shares of the CSE traded West Mining Corp. We believe this
undervalued, below radar company offers a highly attractive investment case
and expect the stock to re-rate on the first hint of positive drilling
news, especially at the flagship Kena and Daylight gold projects.
 
West Mining has executed an option agreement to earn a 100% undivided
interest in Blue Cove copper property in Newfoundland. Located at the head
of Fortune Bay, in south-east Newfoundland, the Blue Cove copper property
comprises 232 claims covering an area of 5,800 ha.
 
Over the past two years, several new targets were identified through
prospecting at the property, where copper mineralisation mostly occurs in
altered volcanic rocks and sediments, with the primary copper minerals
being chalcocite with more minor bornite and chalcopyrite. The best assay
obtained to date from grab samples returned values of 5.1% Cu, 33 g/t Ag
and 0.27 g/t Au.
 
In accordance with the agreement, West Mining will execute the option to
acquire the stake by making a (1) CAD 160,000 cash payment to be paid in
instalments over the next 48 months, (2) issuing 1.7m common West mining
shares to the optionor, and (3) pay a 3% net smelter returns royalty to the
optionor (which West Mining can reduce to 2% for a one-off payment of CAD
1m). In addition, West Mining will also incur an aggregate exploration
expenditure of at least CAD 750,000 on the property.
 
Given the nearby small town of Terrenceville and its deep seaport,
infrastructure is good, making Blue Cove a low-cost property to explore, in
our view. In addition, since this asset is a turnkey operation with a
Newfoundland-based crew on hand makes it an asset that does not require
specific management attention.
 
In our view, the company's current valuation does not discount neither its
Kena/Daylight nor its newly acquired Blue Cover copper project and
certainly excludes any real potential upside from future exploration. Last
year, West Mining announced a resource of 2,774,000 oz Au Inferred and over
562,000 oz Au Indicated at an economically viable cut-off grade of 0.25 g/t
gold. Applying a value of USD 60 and USD 50 per ounce indicated and
inferred gold, respectively, the implied value for West Mining is CAD
215.5m or CAD 2.20 per share. Given the junior mining character of the
business model, we apply a P/NAV multiple of 0.40x and therefore calculate
a price target of CAD 0.88 per share.

Die vollständige Analyse können Sie hier downloaden:
http://www.more-ir.de/d/23369.pdf

Kontakt für Rückfragen
Peter Thilo Hasler, CEFA
+49 (89) 74443558/ +49 (152) 31764553
peter-thilo.hasler@sphene-capital.de

-------------------übermittelt durch die EQS Group AG.-------------------


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