In a report released on Aug. 21, ROTH Capital Partners analyst Joe Reagor described a meeting he had with MAG Silver Corp.'s (MAG:TSX; MAG:NYSE.MKT) management regarding its Juanicipio project in Mexico. The meeting with management focused on Juanicipio "mine plan changes and the potential for further increases in production in the future. . .now we believe the company is planning for additional production increases over time."
Reagor pointed out that MAG Silver's plans "to provide a revised mine plan during Q3 2017 and an FS by year end. We believe these could both provide significant positive catalysts and in particular, the FS could provide a glimpse into the ultimate production potential of the mine."
Exploration was also discussed during the meeting and Reagor believes that "the Juanicipio project has the potential for additional vein discoveries in the future. With this in mind, management said the company plans to revisit exploring for new veins during 2018 now that it is comfortable with the infill drilling completed at Valdecanas."
Reagor stated, "We believe the rest of 2017 could have significant catalysts that lead to revisions in our modeling to the positive side and as such, we are reiterating our Buy rating."
"As a result of the significant production and exploration upside we see in MAG, we are increasing our price target from $19 to $22," Reagor wrote. MAG Silver is currently trading $12.91.
Bhakti Pavani, an analyst with Euro Pacific Capital, also focused on the Juanicipio project in an Aug. 16 report by highlighting the plan to intensify "underground development activity to support a planned increase in mining rate and processing capacity from 2,650 tonnes per day (tpd) to 4,000 tpd." She pointed out that "the permitting for the upgraded design has already been commenced and the new resource estimate and the design upgrades are expected to be incorporated into a revised mine plan and new MAG technical report, which is expected to be released sometime in 3Q."
Pavani noted, "While we reiterate [a] Buy rating on the stock, we are reducing our PT from $17.00 to $15.70."
In an Aug. 15 summary, Raymond James analyst Chris Thompson highlighted that "recent exploration success supports an expanded production scenario larger than originally envisaged, which, with significant additional exploration upside offered by the company's prospective JV ground offers potential to potentially catalyze share price performance in 2017." He continued by explaining "that current prices represent an attractive entry point for investors looking for high margin silver-focused precious metals exposure underpinned by development and exploration upside."
Raymond James' recommendation for MAG Silver is "Stong Buy" with a target price of $25.00.
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1) Melissa Farley compiled this article for Streetwise Reports LLC and provides services to Streetwise reports as an employee. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
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Disclosures from ROTH Capital Markets, MAG Silver, Company Note, Aug. 21, 2017
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.
ROTH makes a market in shares of MAG Silver Corp. and as such, buys and sells from customers on a principal basis.
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.
Euro Pacific Capital, MAG Silver Corp., Company Update, Aug. 16, 2017
Euro Pacific expects to receive or intends to seek compensation for investment banking services from all companies under research coverage within the next three months. Euro Pacific or its officers, employees or affiliates may execute transactions in securities mentioned in this report that may not be consistent with the report’s conclusions.
Regulation Analyst Certification ("Reg AC") — Bhakti Pavani
The views expressed in this report (which include the actual rating assigned to the company as well as the analytical substance and tone of the report) accurately reflect the personal views of the analyst(s) covering the subject securities. An analyst's sector is the universe of companies for which the analyst provides research coverage. Accordingly, the rating assigned to a particular stock represents solely the analyst's view of how that stock will perform over the next 12 months relative to the analyst's sector average.
No part of the compensation of the analyst preparing this report was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed by such analyst in this report.
Raymond James, Canadian Analyst Current Favourites, Aug. 15, 2017
Raymond James & Associates managed/co-managed a public/follow-on offering of these shares or has provided investment banking services within the past 12 months.
The views expressed in this report accurately reflect the personal views of the analyst(s) covering the subject securities. No part of said person's compensation was, is, or will be directly or indirectly related to the specific recommendations or views contained in this research report. In addition, said analyst has not received compensation from any subject company in the last 12 months.