Analyst Actions: Aldrige Minerals Gets "Speculative Buy", $4 TP from Clarus

By Midnight Trader,  June 13, 2012, 11:42:09 AM EDT

Gold Recoveries up 155%. "Recall, the December 2010 PEA contemplated 36% Au recoveries with Au reporting to the copper concentrate. Additional metallurgical work conducted by G&T Metallurgical Services indicates a gold gravity circuit followed by flotation generates Au recoveries of 92%, a 155% increase to recoveries used in the PEA."

Throughput Increase to 7,500tpd Potentially Boosts Yenipazar Economics. "On the back of the expanded resource, Aldridge will be increasing throughput to 7,500tpd from 5,700tpd in the PEA. The increase could see annual payable gold production triple from 23,800 oz to roughly 77,000 oz., generating an additional $80m per year in revenue based on US$1,500/oz Au prices."

Twinning Program Should Bump Grade. "We expect the current 10,000m diamond drill program to lift the reserve grades forming the basis of the DFS. Recall, a small 2011 twinning program saw Au, Ag and Cu grades increase 386%, 132% and 16% respectively in twinned holes. With 99 holes to be twinned this year we expect a nice lift to resource grades going forward."

Valuation: "We maintain our SPECULATIVE BUY rating and target price of $4.00

per share."




The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.


This article appears in: Investing, Commodities

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