Perpetua Resources Corp. (PPTA:TSX; PPTA:NASDAQ) got a 20% boost to its target price by Roth MKM, to US$12 per share from US$10, on the news the U.S. Forest Service (USFS) authorized the mine plan for the Stibnite gold-antimony project in Idaho, reported analyst Mike Niehuser in a September 5 research note.
"This is validation of a vital project with strong economics, important to national security and a once-in-a-generation opportunity to restore fish habitat," Niehuser wrote.
The new target implies a 48% return for investors in Perpetua, as its share price at the time of the report was about US$8.09. Niehuser reiterated Roth's Buy rating on the U.S.-based company.
Federal Approval, Finally
The USFS will publish its authorization of the Stibnite mine plan in its draft record of decision along with the completed final environmental impact statement, on September 6, the analyst reported. The approval is a long time coming, after 14 years of study and eight years of the National Environmental Policy Act permitting process.
Publishing of the final record of decision from the USFS is expected in Q4/24.
Large Antimony Resource
Stibnite may become the U.S.' only domestic antimony source, Niehuser wrote. The country only has 1,100 tons of the metal in National Defense Stockpile. China, producing about 63% of the antimony the U.S. imports, plans to restrict its antimony exports starting Sept. 15.
"Perpetua's Stibnite gold project has about 148,700,000 tons of antimony, sufficient to backstop approximately 50% of U.S. domestic antimony consumption for six years," noted Niehuser.
A Look at Financing
Niehuser addressed the financing of Stibnite. To date, Perpetua received US$75 million in awards from the Department of Defense.
Also it received a letter of interest from the Export Import Bank of the United States (EXIM) for up to US$1.8 billion in funding. If Perpetua is eligible for EXIM's China and Transformational Exports Program, it could get financing terms that are equal to what the Republic of China offers its own state-run businesses.
"This may significantly reduce financing risk for the Stibnite gold project," the analyst added.
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- Perpetua Resources Corp. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
- Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
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Disclosures for Roth MKM, Perpetua Resources Corp., September 5, 2024
Regulation Analyst Certification ("Reg AC"): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.
Disclosures:
ROTH Capital Partners, LLC expects to receive or intends to seek compensation for investment banking or other business relationships with the covered companies mentioned in this report in the next three months. The material, information and facts discussed in this report other than the information regarding ROTH Capital Partners, LLC and its affiliates, are from sources believed to be reliable, but are in no way guaranteed to be complete or accurate. This report should not be used as a complete analysis of the company, industry or security discussed in the report. Additional information is available upon request. This is not, however, an offer or solicitation of the securities discussed. Any opinions or estimates in this report are subject to change without notice. An investment in the stock may involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Additionally, an investment in the stock may involve a high degree of risk and may not be suitable for all investors. No part of this report may be reproduced in any form without the express written permission of ROTH. Copyright 2024. Member: FINRA/SIPC.
