Category: Natural Resources

Thursday, December 19, 2019

Coeur Mining (CDE)

Exploration Efforts to Increase in 2020; Focus on Resource Discovery and Conversion

Coeur Mining Inc is a metals producer focused on mining precious minerals in the Americas. It is involved in the discovery and mining of gold and silver and generates the vast majority of revenue from the sale of these precious metals. The operating mines of the company are palmarejo, rochester, wharf, and kensington. Its projects are located in the United States, Canada and Mexico, and North America.

Mark Reichman, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Coeur releases updates on 2019 exploration program. The central message is that management considered the 2019 exploration program productive, particularly with respect to expansion drilling at Palmarejo, Kensington, Silvertip, and the Sterling and Crown Block properties. Spending was lower in 2019 versus the prior year due to a greater focus on near-mine exploration and the company intends to focus on discovering new resources and converting resources to reserves in 2020.

Exploration expenditures expected to increase in 2020. Coeur expects full year spending in 2019 to be $26 million to $34 million versus $41.9 million and $44.0 million in 2017 and 2018, respectively. We think 2020 spending will be more in line with 2017 and 2018 based on more expansion drilling. We do not expect much change in…

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This research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

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NOTE: investment decisions should not be based upon the content of
this research summary.  Proper due diligence is required before
making any investment decision. 

Improving Economy with Production Cuts are Pushing Oil Prices Higher

(Note: companies that
could be impacted by the content of this article are listed at the base of the
story [desktop version]. This article uses third-party references to provide a
bullish, bearish, and balanced point of view; sources are listed after the
Balanced section.)

WTI Crude prices have mounted a rally over the last 80 days, slowly rising from a price of $53 per barrel at the end of September to a current price above $60 per BBL.    There are many reasons for recent strength, some supply related and some demand related.  However, oil prices are not simply a function of supply and demand.  Note that the rise in oil prices has occurred at the same time oil inventories have also risen.  Instead, oil prices are set by investors who are speculating about future demand and future supply, and investor sentiment is not always easy to measure.  Does the rise in oil prices support the bull’s arguments for further increases in oil prices?  Or, is the rise based on temporary factors that support the bear’s argument that the rise in prices will be short-lived?

Tuesday, December 10, 2019

Great Lakes Dredge & Dock (GLDD)

Renewed Confidence in Dredging Market Outlook

Great Lakes Dredge & Dock is a marine and environmental infrastructure contractor, and the largest dredging company in the United States. Headquartered in suburban Chicago, the company provides port expansion and maintenance, coastal restoration, river dredging and environmental restoration for public and private entities worldwide. In June 2019, the Environmental & industrial (E&I) business was sold for $17.5 million in cash and the company is now pure play on the dredging market.

Poe Fratt, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for price target, fundamental analysis, and rating.

Confidence renewed after investor meetings with the CEO and CFO. 1) Favorable dredging outlook due to funding expansion more than offsets below average win rate and added competition; 2) LNG and wind projects are positives and potential for new awards, including Corpus Christi on/about December 16th, is high; 3) Restructuring impact is durable. Sale of Environmental & Industrial business removed an underperformer; 4) Capital allocation is growth oriented and free cash flow should fund new build(s) in 2020-1; and 5) Improved financials accelerates refinancing of existing debt at first call date in May 2020.

Is insider buying last week a good signal? We think so. Privet Fund, controlled by board member Ryan Levenson, bought a total of 100k shares last week at an average price of $10.61/share and shares owned by Privet increased by more than 50% to 290k shares. While it is always difficult to pinpoint the exact reasons, we interpret the…

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This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst
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NOTE: investment decisions should not be based upon the content of
this research summary.  Proper due diligence is required before
making any investment decision. 

Tuesday, December 10, 2019

Coeur Mining (CDE)

Increasing 2020 Estimates; Maintaining Outperform Rating

Coeur Mining Inc is a metals producer focused on mining precious minerals in the Americas. It is involved in the discovery and mining of gold and silver and generates the vast majority of revenue from the sale of these precious metals. The operating mines of the company are Palmarejo, Rochester, Wharf, and Kensington. Its projects are located in the United States, Canada and Mexico, and North America.

Mark Reichman, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to full report for the price target, fundamental analysis, and rating.

Increasing 2020 estimates. We are increasing our 2020 EPS and EBITDA estimates to $0.13 and $265.8 million from $0.10 and $256.2 million, respectively. The drivers are modestly higher production and lower operating costs. We expect additional gains in productivity at Silvertip and cost improvement at Rochester due to the deployment of the high-pressure grinding roll technology.

Well-positioned going into 2020. Third-quarter performance was much improved relative to the prior-year period and second quarter of 2019 due to higher average gold and silver prices and strong mine operating performance from Rochester and Wharf, along with continued improvement at Silvertip. Additionally, the company has significantly reduced debt, increased its cash position and…

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This research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst
certification and important disclosures included in full report. 
NOTE: investment decisions should not be based upon the content of
this research summary.  Proper due diligence is required before
making any investment decision. 

Presidential Hopefuls Float Plans to Curb Fossil Fuels

(Note: companies that
could be impacted by the content of this article are listed at the base of the
story [desktop version]. This article uses third-party references to provide a
bullish, bearish, and balanced point of view; sources are listed after the
Balanced section.)

With Democratic 2020 presidential hopefuls embracing green energy to curb climate change, proposals to ban hydraulic fracturing (fracking), limiting U.S. exports of fossil fuels and carbon taxes have all entered the public debate.  Due to the increased use of hydraulic fracturing and horizontal drilling, the United States has significantly increased its production of crude oil and natural gas.  The U.S. Energy Information Administration expects total crude oil and petroleum net exports to average 750,000 barrels per day (b/d) in 2020 compared with average net imports of 520,000 b/d in 2019.  U.S. liquefied natural gas (LNG) exports are expected to average 4.7 billion cubic feet per day (Bcf/d) in 2019 and 6.4 Bcf/d in 2020 as three new liquefaction projects are commissioned.  This has resulted in significant economic and political gains.  As the country moves from limiting its dependence on energy imports to becoming a significant exporter of energy, should it consider restricting exports in the interest of curbing climate change?  Restricting exports would have both positive (bull) and negative (bear) implications for energy producers, consumers and investors.

Monday, December 2, 2019

Great Panther Mining Limited (GPL)

GPL Cuts 2019 Production Guidance Again; Lowering Rating to Market Perform

Great Panther Mining Limited, headquartered in Vancouver, Canada, is a precious metals mining and exploration company that operates three mines. These include 1) the Tucano gold mine in Amapa State, Brazil, 2) the Guanajuato mine complex which includes the Guanajuato and San Ignacio mines in Mexico, and 3) the Topia mine in Mexico. Great Panther also owns the Coricancha Mine in Peru, which is expected to restart operations in 2020. The shares are traded under the ticker “GPR” on the Toronto Stock Exchange and under the ticker “GPL” on the NYSE American.

Mark Reichman, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to full report for the price target, fundamental analysis, and rating.

Production guidance lowered.  Management lowered its 2019 production guidance for the second time and now expects a full-year production of 142,000 to 149,000 gold equivalent ounces compared to previous guidance of 150,000 to 160,000 gold equivalent ounces. The Tucano mine is now expected to produce between 31,000 and 33,000 gold ounces during the fourth quarter versus prior expectations of 39,000 to 44,000 ounces.

Updating estimates.  We are lowering our 2019 EPS and EBITDA estimates to ($0.10) and $20.1 million from ($0.07) and $26.4 million, respectively. Our full-year 2020 EPS and EBITDA estimates have also been lowered to $0.04 and…

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This research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst
certification and important disclosures included in full report. 
NOTE: investment decisions should not be based upon the content of
this research summary.  Proper due diligence is required before
making any investment decision. 

Monday, December 2, 2019

Aurania Resources Ltd. (ARU:CA)

On the Road to Finding the Lost Cities?

Aurania Resources Ltd. is a Canada-based junior mining exploration company engaged in the identification, evaluation, acquisition, and exploration of mineral property interests, with a focus on precious metals and copper. Its flagship asset, The Lost Cities-Cutucu Project, is in southeastern Ecuador in the Province of Morona-Santiago. The company also has several minor projects in Switzerland.

Mark Reichman, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to full report for the price target, fundamental analysis, and rating.

Discovery could lead the way to find the Lost Cities.  Vestiges of an old road were discovered in the central part of Aurania’s Lost Cities – Cutucu project. The road is believed to be one that linked two historic gold mining centers, Sevilla de Oro and Logrono de los Caballeros, both believed to be within the Lost Cities project area.

Next steps.  A LiDAR survey will be expedited over the area which should be able to detect extensions to the road and its termination at the historical mine sites. Findings will be incorporated into Metron’s data analytics process to…

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NOTE: investment decisions should not be based upon the content of
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Friday, November 22, 2019

Aurania Resources Ltd. (ARU:CA)

Drilling at Yawi is Off to a Good Start

Aurania Resources Ltd. is a Canada-based junior mining exploration company engaged in the identification, evaluation, acquisition, and exploration of mineral property interests, with a focus on precious metals and copper. Its flagship asset, The Lost Cities-Cutucu Project, is in southeastern Ecuador in the Province of Morona-Santiago. The company also has several minor projects in Switzerland.

Mark Reichman, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to full report for price target, fundamental analysis and rating.

First drill hole completed at Yawi. Scout drilling at the first hole at Yawi Target A has been completed and samples have been submitted to the laboratory. The second bore hole at Target A is currently being drilled. Recall that four targets have been identified at Yawi and a fifth is being mapped and soil sampled to determine whether it warrants scout drilling.

Refining targets for future drilling. Aurania’s heliborne geophysics program has been completed on the entire project area. The company’s stream sediment sampling program, which has been completed on over 50% of the Lost Cities Project, has…

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NOTE: investment decisions should not be based upon the content of
this research summary.  Proper due diligence is required before
making any investment decision. 

Friday November 15, 2019

Sierra Metals (SMTS)

Higher EBITDA and Operating Cash Flows Driven by Strong Q3 Production

Sierra Metals Inc is a precious and base metals producer in Latin America. The company acquires, explores, extracts, and produces mineral concentrates consisting of silver, copper, lead, zinc and gold in Mexico and Peru. Its activity includes the operation of the Yauricocha Mine in Peru, and the Bolivar and Cusi mines in Mexico. Yauricocha is an underground polymetallic mine using the sublevel block caving and cut-and-fill mining methods. Bolivar is a copper-silver-zinc-gold underground mine using room-and-pillar mining method. The majority of the revenue is earned by selling of the mineral concentrates to its customers in Peru.

Mark Reichman, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to full report for price target, fundamental analysis and rating.

• Third quarter financial results. Sierra Metals generated net income attributable to shareholders of $1.8 million, or $0.01 per share, compared to $1.9 million, or $0.01 per share, during the prior year period. Adjusted EBITDA amounted to $21.6 million versus $18.2 million during the prior year period and our estimate of $23.4 million. The increase relative to the prior year period was attributed to higher revenue driven by production growth.
• Updating estimates. We are revising our full year 2019 EPS and EBITDA estimates to $0.03 and $69.2 million from $0.08 and $74.2 million, respectively. Additionally, we have trimmed our 2020 EPS and EBITDA estimates to $0.26 and $134.5 million from $0.30 and…
  
  

  
  

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NOTE: investment decisions should not be based upon the content of
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making any investment decision. 

Friday, November 15, 2019

Pyxis Tankers Inc. (PXS)

Solid Improvement Likely Extends Into Next Year

Pyxis Tankers Inc is a United States-based international maritime transportation company which focuses on the product tanker sector. It owns a fleet which comprises of double hull product tankers employed under a mix of short- and medium-term time charters and spot charters. The fleet owned by the company includes Pyxis Epsilon, Pyxis Theta, Pyxis Malou, Pyxis Delta, Northsea Alpha, and Northsea Beta. Each of the vessels in the fleet is capable of transporting refined petroleum products, such as naphtha, gasoline, jet fuel, kerosene, diesel, fuel oil, and other liquid bulk items, such as vegetable oils and organic chemicals.

Poe Fratt, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to full report for price target, fundamental analysis and rating.

• Positive direction with 3Q2019 EBITDA of $2.1 million ahead of expectations due to stronger MR and small tankers performance. 3Q2019 TCE rates of $12,360/day and operating days of 500 were up sequentially.
  
• Increasing 2019 Estimate to $6.2 million to reflect quarterly results and forward cover. TCE rate estimate is $11,899/day and forward cover is 57% of available…
  
  

  
  

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This research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst
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NOTE: investment decisions should not be based upon the content of
this research summary.  Proper due diligence is required before
making any investment decision. 

Wednesday, November 13, 2019

Genie Energy Ltd. (GNE)

Boring quarter welcomed after rough 2Q

Genie Energy Ltd, through its subsidiaries, operates as a retail energy provider; and an oil and gas exploration company. Its segments are Genie Retail Energy (GRE) which is the key revenue generator, Genie Energy Services (GES), and Genie Oil and Gas (GOGAS). GRE owns and operates retail energy providers (REPs), including IDT Energy, Residents Energy, Town Square Energy, and Mirabito. Its REP businesses resell electricity and natural gas to residential and small business customers in the Eastern and Midwestern United States. GES designs, manufactures and distributes solar panels and also offers energy brokerage and advisory services. GOGAS is an oil and gas exploration company that owns an interest in a contracted drilling services operation and interest in Afek Oil and Gas (Afek).

Michael Heim, CFA, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to full report for price target, fundamental analysis and rating.

• GNE reported 2019-3Q EPS of $0.18 and adjusted EBITDA of $8.0 million, in line with our $0.17 and $8.6 million estimates. A solid quarter for the company supports claims that disappointing 2Q results were largely weather related.
  
• Investing for the future.  GNE’s expansion into the Texas market this summer and Japan in January should pay dividends in 2020 and beyond. Global meters rose to 492,000 from 448,000. International adjusted EBITDA was ($1.6) million versus…
  
  

  
  

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NOTE: investment decisions should not be based upon the content of
this research summary.  Proper due diligence is required before
making any investment decision. 

Wednesday November 13, 2019

Endeavor Silver (EXK)

Will El Curso Play a Role in Guanacevi’s Turnaround?

Endeavour Silver Corp is a precious metal mining company. The company is primarily engaged in silver mining and owns three high-grade, underground, silver-gold mines in Mexico. Its other business activities include acquisition, exploration, development, extraction, processing, refining and reclamation. It is also involved in exploration activities in Chile. The company is organized into three operating mining segments, Guanacevi, Bolanitos and El Cubo, which are located in Mexico as well as Exploration and Corporate segments. The Exploration segment consists of projects in the exploration and evaluation phases in Mexico and Chile.

Mark Reichman, Senior Research Analyst of Natural Resources, Noble Capital Markets, Inc.

Refer to full report for price target, fundamental analysis and rating.

• Initial drilling results are encouraging.  Endeavour reported positive initial drilling results for the El Curso property adjacent to Endeavour’s Guanacevi mine in Durango, Mexico. By our calculation, weighting the grams per tonne by the interval lengths, the weighted average grades for silver, gold and silver equivalents are 671.8 grams per tonne, 1.63 grams per tonne and 802.4 grams per tonne, respectively. For a point of reference, the weighted average grade of Guanacevi’s reserves and resources, excluding silver-gold-lead-zinc mineral resources, are 312.5 grams per tonne of silver and 0.78 grams per tonne of gold.
  
• El Curso may play a role in getting Guanacevi to full production. Management plans to drill another 10 holes before year end 2019 and then complete an initial resource estimate. The new mineralization is expected to be included in the …
  

  
  

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NOTE: investment decisions should not be based upon the content of
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Wednesday November 06, 2019

Endeavor Silver (EXK)

Third Quarter In Line With Our Expectations; Lowering 2020 Estimates

Endeavour Silver Corp is a precious metal mining company. The company is primarily engaged in silver mining and owns three high-grade, underground, silver-gold mines in Mexico. Its other business activities include acquisition, exploration, development, extraction, processing, refining and reclamation. It is also involved in exploration activities in Chile. The company is organized into three operating mining segments, Guanacevi, Bolanitos and El Cubo, which are located in Mexico as well as Exploration and Corporate segments. The Exploration segment consists of projects in the exploration and evaluation phases in Mexico and Chile.

Mark Reichman, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to full report for price target, fundamental analysis and rating.

• Third quarter results in line with estimates.  Endeavour reported a third quarter loss of $6.8 million, or ($0.05) per share, compared to a loss of $5.5 million, or ($0.04) per share during the prior year period. We had projected a loss of $6.8 million, or ($0.05) per share. Adjusted EBITDA were $1.8 million compared to $6.3 million generated during the prior year period.
  
• Lowering 2020 estimates. While we are making no changes to our 2019 estimates, we are lowering our 2020 EPS estimate to $0.08 per share from $0.12 due mainly to narrower margin assumptions. We now forecast…
  

  
  

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This research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst
certification and important disclosures included in full report. 
NOTE: investment decisions should not be based upon the content of
this research summary.  Proper due diligence is required before
making any investment decision.