Vizsla Silver Corp. (VZLA:TSX.V; VZLA:NYSE) gained further research coverage as Leede Jones Gable just initiated on the mining company with a Speculative Buy rating and a target price implying a 110% return, reported analyst Ronald Stewart in an Aug. 14 research note.
"We consider Vizsla Silver Corp.'s Panuco project, located in Sinaloa, Mexico, to be one of the best new silver-gold discoveries anywhere in the world today," Stewart wrote. " Our analysis of the drill results reported since the current resource was released in January 2023 suggests that upside at similarly attractive grades is virtually assured."
Potential gain of 110%
Leede Jones Gable assigned a CA$2.90 per share target price to Vizsla, currently trading at about CA$1.38 per share in comparison, noted Stewart.
From here, the return to target reflects a gain of 110%.
"The risk/reward favors an investment in Vizsla," the analyst added.
Large, high-grade mineral inventory
Stewart discussed the factors that make the British Columbia-based explorer-developer attractive. Topping the list is its Panuco precious metals project in Mexico. It boasts an existing resource that is large and high grade and has obvious expansion potential.
Panuco features a low-sulphidation, epithermal gold lode system. High-grade silver-gold mineralization, along with associated base metal sulphides, is present in multiple veins.
Vizsla has been busy exploring the property, and has completed 250,000 meters (250,000m) of drilling there to date. Through this work, it has discovered several high-grade veins.
The current Vizsla resource encompasses 10 veins and is high grade and sizable. It is comprised of 105,000,000 ounces silver equivalent (105 Moz Ag eq), or 7,500,000 tons (7.5 Mt) at 437 grams per ton (437 g/t), of Indicated resources and 114 Moz Ag eq, or 7.2 Mt at 491 g/t, of Inferred resources.
This is only the beginning as significant resource upside is obvious. The company has reported 136 more mineralized intercepts from three main targets since the resource was calculated. The average grade of these additional intercepts is 596 g/t Ag eq over an average true width of 3.5m.
Drilling extended the Copala vein complex 500m along strike. It also revealed a new high-grade vein discovery at La Luisa, with a grade of 577 g/t Ag eq over an average true width of 1.85m. Both Copala and La Luisa remain open along strike.
Plus, the 10 veins incorporated in the resource represent only about 10% of the total vein strike length identified on the property.
Stewart pointed out that compared to 11 silver explorer peers, Vizsla currently has the fourth-largest Ag eq total mineral inventory, 224 Moz, according to Leede Jones Gable's analysis. The average grade, 474 g/t Ag eq, is the second highest.
"At US$0.88 per ounce, Vizsla's enterprise value per ounce is the third highest, reflecting the market's enthusiasm for the size, grade and upside potential of the project," the analyst added.
Balance sheet looks good
Vizsla is in a strong position financially, Stewart noted. It has no debt and about CA$45 million in cash, "sufficient for over a year of continued exploration expenditures."
Upcoming catalysts
This year, reported Stewart, Vizsla will complete the current 90,000m drill program at Panuco, now more than halfway finished, and update the project's resource estimate. Next year, the company will conduct a preliminary economic assessment.
Leadership at a glance
Stewart presented the bios of Vizsla's management team and board members.
Executive Chairman Craig Perry and Chief Executive Officer Michael A. Konnert co-founded Vizsla Silver as well as Inventa Capital Corp., a venture capital advisory firm working in the natural resources sector.
Parry also co-founded Vizsla Copper, Gold Bull Resources and Outback Goldfields. Throughout his career, he has served as a chief executive officer (CEO), senior executive and geologist in various commodities and has led and been involved in some significant discoveries.
Konnert previously was CEO of CobaltOne Energy, a battery metal exploration company sold in 2017.
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