Perpetua Resources Corp. (PPTA:TSX; PPTA:NASDAQ) received a Final Record of Decision (FROD) on Stibnite, the past-producing Stibnite gold-antimony mining project in Idaho it owns, from the U.S. Forest Service, reported Cantor Fitzgerald Analyst Mike Kozak in a Jan. 6 research note. On the news, Cantor raised its one-year target price on the U.S. explorer by 16.25%.
"This is the single most important positive derisking milestone event in Perpetua's history," Kozak wrote, and it comes after eight years of public feedback, consultation, redesign, re-engineering, investigation and analyses.
Raised Target, Buy Rating
Stibnite is a "highly unique" and, now with the FROD secured, "strategically important" project given its antimony component, Kozak wrote. Accordingly, Cantor raised its target multiple on the company to 1.2x net asset value per share discounted at 7.5% from 1x "to reflect a likely takeover premium."
This led to the new price target of CA$23.25 per share, up from CA$20. Given Perpetua is trading now at about CA$15.96 per share, the return to the new target is 46%.
The company remains a Buy.
What to Watch For
To move forward with construction at Stibnite, Perpetua must receive the final federal Clean Water Act Section 404 permit from the U.S. Army Corps of Engineers. This is anticipated soon as it already is in the works.
Once in hand, Perpetua will make a construction decision, presumedly to move forward.
Also, the company is expected to secure up to US$1.8 billion in project debt financing from the Export-Import Bank of the U.S., possibly as early as in H1/25.
"With these positive catalysts ahead in the short term, we continue to view Perpetua's shares as attractive," Kozak wrote.
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