West Red Lake Gold Mines Ltd.'s (WRLG:TSX.V; WRLGF:OTCQB; FRA:UJO) board greenlighted restarting the Madsen underground gold mine in northwestern Ontario's Red Lake District, and the decision came earlier than the mid-2025 target, reported Cantor Fitzgerald Analyst Matthew O'Keefe in a May 22 research note.
"We expect the mine to deliver over 30,000 (30 Koz) of gold in 2025 and 60 Koz of gold in 2026," O'Keefe wrote.
182% Potential Uplift
At the time of O'Keefe's report, the Canadian mining company was trading at about CA$0.78 per share, at 0.3x net asset value assigned by Cantor, a significant discount to gold producer peers at 0.8x, noted the analyst.
"With production now underway, we expect West Red Lake Gold's multiple to expand towards the peer average and our target price of CA$2.20 per share over the next couple of quarters as it proves its operating ability," the analyst wrote.
Cantor's target implies a 182% return for investors. West Red Lake Gold remains a Buy.
Ramp-up Slated for H2/25
O'Keefe pointed out that the decision to restart Madsen comes after two years of derisking work. After acquiring the asset in June 2023, West Red Lake Gold improved the existing infrastructure, further developed the mine and refined the mine plan. Most recently, it conducted bulk sampling testing that validated modeled grades and tons as well as mining methods.
The company will transition Madsen to a steady-state operation at about 500 tons per day (500 tpd) then ramp it up to 800 tpd in H2/25.
"This is in line with our estimates," wrote O'Keefe.
Stock Data
O'Keefe reported that at the time of his report, West Red Lake Gold had 343.2 million (343.2M) basic shares outstanding and 517M fully diluted shares outstanding. It had a market cap of CA$267.7 million and a 52-week range of CA$0.52–0.88 per share.
| Want to be the first to know about interesting Gold investment ideas? Sign up to receive the FREE Streetwise Reports' newsletter. | Subscribe |
Important Disclosures:
- West Red Lake Gold Mines Ltd. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
- As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of West Red Lake Gold Mines Ltd.
- Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor/employee.
- This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.
For additional disclosures, please click here.
Disclosures for Red Cloud Securities, West Red Lake Gold Mines Ltd., May 23, 2025:
Red Cloud Securities Inc. is registered as an Investment Dealer and is a member of the Canadian Investment Regulatory Organization (CIRO). Red Cloud Securities registration as an Investment Dealer is specific to the provinces of Alberta, British Columbia, Manitoba, Ontario, Quebec, and Saskatchewan. We are registered and authorized to conduct business solely within these jurisdictions. We do not operate in or hold registration in any other regions, territories, or countries outside of these provinces. Red Cloud Securities bears no liability for any consequences arising from the use or misuse of our services, products, or information outside the registered jurisdictions.
Part of Red Cloud Securities Inc.'s business is to connect mining companies with suitable investors. Red Cloud Securities Inc., its affiliates and their respective officers, directors, representatives, researchers and members of their families may hold positions in the companies mentioned in this document and may buy and/or sell their securities.
Additionally, Red Cloud Securities Inc. may have provided in the past, and may provide in the future, certain advisory or corporate finance services and receive financial and other incentives from issuers as consideration for the provision of such services.
Red Cloud Securities Inc. has prepared this document for general information purposes only.
This document should not be considered a solicitation to purchase or sell securities or a recommendation to buy or sell securities. The information provided has been derived from sources believed to be accurate but cannot be guaranteed. This document does not take into account the particular investment objectives, financial situations, or needs of individual recipients and other issues (e.g. prohibitions to investments due to law, jurisdiction issues, etc.) which may exist for certain persons. Recipients should rely on their own investigations and take their own professional advice before investment. Red Cloud Securities Inc. will not treat recipients of this document as clients by virtue of having viewed this document.
Red Cloud Securities Inc. takes no responsibility for any errors or omissions contained herein, and accepts no legal responsibility for any errors or omissions contained herein, and accepts no legal responsibility from any losses resulting from investment decisions based on the content of this report.
Company Specific Disclosure Details
The analyst has visited the head/principal office of the issuer or has viewed its material
operations.
The issuer paid for or reimbursed the analyst for a portion, or all of the travel expense associated with a visit.
In the last 12 months preceding the date of issuance of the research report or recommendation, Red Cloud Securities Inc. has performed investment banking services for the issuer.
In the last 12 months, a partner, director or officer of Red Cloud Securities Inc., or an analyst involved in the preparation of the research report has provided services other than in the normal course investment advisory or trade execution services to the
issuer for remuneration.
Analysts are compensated through a combined base salary and bonus payout system. The bonus payout is determined by revenues generated from various departments including Investment Banking, based on a system that includes the following criteria: reports generated, timeliness, performance of recommendations, knowledge of industry, quality of research and client feedback. Analysts are not directly compensated for specific Investment Banking transactions. Recommendation Terminology
Dissemination
Red Cloud Securities Inc. distributes its research products simultaneously, via email, to its authorized client base. All research is then available on www.redcloudsecurities.com via login and password.
Analyst Certification
Any Red Cloud Securities Inc. research analyst named on this report hereby certifies that the recommendations and/or opinions expressed herein accurately reflect such research analyst’s personal views about the companies and securities that are the subject of this report. In addition, no part of any research analyst’s compensation is, or will be, directly or indirectly, related to the specific recommendations or views expressed by such research analyst in this report.
