Roth Capital Partners has reiterated a Buy rating with a $1 price target on Great Panther Mining Limited (NYSEAMERICAN:GPL) (TSE:GPR), noting that the company strengthened its balance sheet to $21 million to drive exploration in 2020.
“Given the company's recent cash infusion following concentrate pre-payment agreements, we believe Great Panther is well funded to execute on its exploration plans for 2020,” wrote analyst Jake Sekelsky in a note to investors.
In early February, Great Panther received $11.3 million as part of a gold prepayment facility and an additional $10 million from a concentrate prepayment agreement.
Roth’s reiteration on Thursday also came just after Great Panther outlined plans to maximize its Tucano gold mine's exploration potential with plans to drill 55,000 metres on a budget of US$6.6 million this year. Tucano in Brazil was bought in March last year and is already seeing improved production rates. Last year, Great Panther carried out 17,400 metres of exploration drilling.
Sekelsky called Tucano a ”primary catalyst for Great Panther during 1H20” and he’s bullish on the mine’s potential.
“In short, we believe Tucano hosts significant exploration potential and believe management is taking prudent steps to unlock additional value at the project,” he said.
The analyst added: “Given the company's increased cash balance, we believe the company possesses the necessary working capital to move forward with the technical review at Tucano and conduct exploration work across the project. Given this, we believe Great Panther remains undervalued at current levels."
Great Panther's stock recently traded down 3% to US$0.58 a share in New York.
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