Dakota Gold Corp. (DC:NYSE American) has announced a significant investment from Orion Mine Finance, with a commitment of US$6 million, potentially increasing to up to US$9 million. This investment comes from OMF Fund IV SPV A LLC and OMF Fund IV SPV C LLC, managed by Orion Mine Finance Management LP. This new influx of capital is part of an ongoing strategic partnership between Dakota Gold and Orion, marking a continued collaboration in revitalizing the historic Homestake District in Lead, South Dakota.
Jonathan Awde, President, CEO, and Director of Dakota Gold, expressed his enthusiasm about the continued partnership with Orion, highlighting Orion's respected position in the mining industry. He noted that Orion's investment will increase their ownership in Dakota Gold to 9.9%, reinforcing the investor's confidence in the company's potential and future prospects.
Industry experts and market reports have highlighted the bullish trends and underlying factors driving the mining and metals sector, specifically focusing on gold and silver,
A Look At Precious Metals
In a June 24 Schiff Gold report on Ahead of the Herd, it was noted that "Inflation is going to keep going up — that's why gold is rising. It's a signal that the monetary policy is wrong . . . In fact, they should be raising interest rates, but the gold traders know that Powell is too afraid to raise interest rates because he'll cause a financial crisis." Furthermore, the report emphasized the potential growth in mining stocks, with the GDX index of senior gold mining stocks up 7% and the GDXJ index of junior mining stocks up 9% in the same week, indicating strong investor confidence in the sector.
A June 19 report from Chen Lin of What is Chen Buying? What is Chen Selling? noted how silver has also emerged as a top-performing commodity in 2024, surging by more than 30% and outpacing gold. Industry experts suggested that this silver rally was just the beginning, with minimal technical resistance between the US$30/oz and US$50/oz price levels. The report highlighted the surging demand for solar panels, fueled by declining prices and increasing climate-related energy disruptions, as a significant driver of silver's performance. Silver's role in emerging technologies, such as artificial intelligence (AI), was also noted as a critical factor in its growing demand.
On June 28, an article from Barry Dawes of Martin Place Securities emphasized the resilience and technical strength of gold, with gold holding above US$2300 and maintaining a strong technical position. Dawes highlighted the impressive performance of gold stocks relative to gold, predicting a strong performance in the December half of 2024. Additionally, the article noted the positive outlook for white metals, including silver, platinum, and palladium, with platinum expected to double in price over the next few years.
Company Catalysts Section
One of the major catalysts for Dakota Gold is the substantial equity investment from Orion Mine Finance. According to the news release, Orion has agreed to purchase over 2.3 million shares of common stock at US$2.50 per share, amounting to US$5.9 million. Following this equity investment, Orion is expected to own approximately 9.9% of Dakota Gold's outstanding shares. The investment is scheduled to close around July 3, 2024, under the Securities Act of 1933, registered via the company's shelf registration statement on Form S-3.
Additionally, Dakota Gold and Orion are set to enter a royalty agreement for a 1% net smelter returns royalty on certain Dakota Gold properties, providing Dakota Gold with US$182,758.20 in total consideration. This agreement underscores the strategic importance of Orion's support and its role in Dakota Gold's development plans.
Industry Experts on Dakota Gold
Industry experts have highlighted significant advancements and positive prospects for Dakota Gold, emphasizing the company's exploration success and strategic positioning. The Northern Miner newsletter reported a positive market reaction to Dakota Gold's developments on June 20th, with shares rising 6% by mid-afternoon on a Thursday in Toronto, valuing the company at CA$333 million. This increase in share value reflects investor confidence in Dakota Gold's ongoing projects and future prospects.
Additionally, The Northern Miner highlighted that Dakota Gold had drilled high-grade gold intercepts at the 34 and 35 ledges in Maitland's JB Gold zone, which remain open along strike and to depth. These high-grade intercepts are crucial for delineating the extent of mineralization and advancing the project toward development.
On June 20, Dakota Gold announced the results of eight additional drill holes targeting the JB Gold Zone at its Maitland Gold Project in South Dakota. The drilling aimed to test for Homestake Mine-Style gold mineralization, one of three ongoing programs by the company. The results included significant gold grades, such as 9.46 g/t Au over 6.4m from 506.2m, and further demonstrated the continuity and potential for a substantial Homestake-style deposit at JB.
Capital Markets analysts maintained a positive outlook, stating that Dakota Gold's continued advancement of Homestake-style targets adds excitement and optionality to the Richmond Hill deposit. They also rated Dakota Gold with a Speculative Buy and a target price of US$5.75, reflecting strong confidence in the company's future performance.
Streetwise Ownership Overview*
Dakota Gold Corp. (DC:NYSE American)
Ownership and Share Structure
According to the company, approximately 25% of its shares are with management and insiders.
Out of management, Quartermain holds the most shares at 8.43%, Awde is next at 6.82%, while COO Jerry Aberle holds 4.85%, according to Reuters.
About 26% of the shares are with institutional investors, according to Yahoo Finance and Edgar filings.
Top institutional holders include Fourth Sail Capital with 5.27%, Van Eck Associates with 4.12%, Blackrock Institutional Trust Co. with 3.72%, The Vanguard Group Inc. with about 3.27%, Fidelity Management and Research Co. LLC with 2.7%, and CI Global Asset Management with 2.55%, Reuters reported.
About 16.5% is with strategic investors, including Orion Mine Finance, which owns about 7.6%, and Barrick Gold Corp., which owns about 3%. The rest is retail.
Dakota Gold has a market cap of US$212.25 million, with 87.7 million shares outstanding. It trades in a 52-week range of US$3.25 and US$1.95.
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Important Disclosures:
- Dakota Gold Corp. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
- As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Dakota Gold Corp.
- James Guttman wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
- This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.
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