Strong Q1 2024 Results and Strategic Asset Updates Drive Growth

Metalla Royalty & Streaming Ltd. (MTA:TSX.V; MTA:NYSE American) announced strong financial results for Q1 2024 and provided significant updates on its assets. The company reported revenue of US$1.3 million and an adjusted EBITDA of US$0.1 million. Key developments include increased production at La Encantada, El Realito, and Wharf. Notably, First Majestic discovered a significant water resource at La Encantada, expected to improve throughput rates by Q3 2024.

Additionally, IAMGOLD Corp. (IMG:TSX; IAG:NYSE) achieved the first gold pour at Côté, with commercial production anticipated by Q3 2024. First Quantum Minerals Ltd. (FM:TSX; FQM:LSE) expects to receive Environmental and Social Impact Assessment approval for Taca Taca this year, facilitating project advancement for Metalla moving forward. In 2021, Metalla Royalty & Streaming Ltd. strengthened its portfolio by acquiring a 1.35% net smelter return (NSR) royalty on the Côté Gold Project and the Gosselin project, both owned by IAMGOLD Corporation (IAMGOLD) and Sumitomo Metal Mining Co., Ltd. 

Brett Heath, CEO of Metalla, highlighted the company's focus on integrating its business post-merger with Nova Royalty Corp. (NOVR:TSX.V) and seeking acquisitions that enhance shareholder value. These strategic initiatives underscore Metalla's commitment to optimizing its portfolio and driving growth.

The Metals Sector

Katusa Research posted a recent look at the gold market, calling it "The Golden Bull Market of the Century."  The site wrote about gold's "unprecedented closing highs on most trading days in March" and how, in most nations, it is seen as a symbol of wealth and prosperity. Adding, "It's not a matter of if, but when this bull market will take off. You're already seeing this in real-time."

"It is selling at little more than 50% of NAV, so it remains very undervalued, and if you do not own it, Metalla can be bought," Global Analyst Adrian Day said.

The rush for gold is causing many to take notice. Among them is independent gold and silver analyst Hubert Moolman who remarked, "Not only is gold in a bull run, but it has entered the phase which can be compared to a bank run (as previously explained) on the world financial system, with the U.S. dollar financial system acting as the world banker."

What does that mean exactly? A bull run for gold might be more long-term than most expect. As Bob Hoye of 321Gold posted in May 2024, "The bull market for the Golds could run for years with some outstanding rallies for companies from Majors to Juniors."

In terms of silver, Dominic Frisby of The Flying Frisby recognized some of the trepidation people faced with the investment on May 22 but stressed that the market fluctuates, pointing out, "Despite the perennial disappointment of the silver price, every now and then it moonshots — and returns to its rightful place in the sky. It went from below $5/oz in 1978 to $50/oz in 1980, followed by 20 years of disappointment. It went from below $8/oz in 2008 to $50/oz in 2011. There then followed another 13 years of disappointment. But those moonshots were very brief. You had a day or two to get out. Are we midway through another moonshot? It is very possible."

Catalysts

Metalla Royalty & Streaming Ltd. outlined several catalysts for growth in its Q1 2024 financial results. The company's strategic integration and streamlining post-merger with Nova Royalty have positioned it to seek accretive acquisitions and refine its current portfolio.

"In the first quarter of 2024, we focused on integrating and streamlining our business following the completion of the merger with Nova Royalty in December 2023. Now, we will continue to seek acquisitions that will be accretive to shareholders and look for ways to refine our current portfolio of royalties to maximize value," said Brett Heath, President and CEO.

Key asset updates include the development at La Encantada, where First Majestic Silver Corp. anticipates improved ore throughput rates by Q3 2024. Additionally, significant production and exploration activities are ongoing at El Realito, Wharf, and Aranzazu, with companies like Agnico Eagle Mines Ltd. (AEM:TSX; AEM:NYSE) and Aura Minerals Inc. (ORA:TSX; AURA33:B3) reiterating strong production guidance and extensive drilling campaigns.

The commissioning at Côté and Taca Taca's anticipated Environmental and Social Impact Assessment approval also adds to the growth potential, while Fosterville, Endeavor, and Tocantinzinho projects highlight robust exploration and development plans, promising further resource expansion and operational milestones.

Expert Opinions

Chairman and CEO of Adrian Day Asset Management, Adrian Day, looked at the uptick in Metalla since the start of the year in an April 3 report.

Day pointed out, "It was a transformative year for Metalla, most notably the merger with Nova Royalty, and a new strategic plan, including the cancellation of its "At-the-Market" equity issuance plan, a doubling of the Beedie convertible loan facility to CA$50 million, plans to reduce debt; and plans to pay dividends."

One month later, Day again spoke out about Metalla investments on May 22. Day explained, "The Cȏté mine is expected to generate some revenue for Metalla by the end of next year as mining progresses to its royalty land, gradually building until the Gosselin area is incorporated into the mine plan. Other projects on which Metalla holds royalties, including Equinox's Castle Mountain, Agnico's Wasamac, and First Quantum's Taca Taca, are all progressing along their development schedules. CEO Brett Heath tantalizingly noted that the company will "look for ways to refine our current portfolio" without giving additional information. The stock popped US24 cents on Friday, so we will look to buy more as it settles down from that four-week high."

He added, "We were buying under US$3 in the last couple of weeks as a newsletter sell recommendation took the stock down. It is selling at little more than 50% of NAV, so it remains very undervalued, and if you do not own it, Metalla can be bought."

Ownership & Share Structure

4.13% of the company, according to Reuters is held by management and insiders.

CEO Brett Heath has 3.66%, with 3.34 million shares.

9.51% is with strategic investor Beedie Investments Ltd., with 8.70 million shares. 

12.43% is with institutional investors. Van Eck Associates Corp. has 4.92%, with 4.50 million shares, and Euro Pacific Asset Management LLC has 4.40%, with 4.03 million.

Its market cap is CA$221.4 million, with 52.84 million shares outstanding and 40.15 million free-floating.

It trades in a 52-week range of CA$7.91 and CA$3.56.

Important Disclosures:

1. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Metalla Royalty & Streaming and Agnico Eagle Mines Ltd.
2. James Guttman wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
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