Shares of Detour Gold Corp. have jumped more than Ten percent within the last 2 days as several analysts heaped praise over the company due to its new mine plan and hiked their price targets.
Detour, which operates a massive open-pit mine in Northern Ontario, announced the updated anticipate Monday. It incorporates a new block in the deposit, which reinforces the overall gold reserves to 16.9 million ounces and boosts the mine life by 3 years. By comparison, reserves stood at 14.9 million ounces after 2014.
The new mine plan also boosts the overall economics of the project by decrease in costs. It assumes a smaller mining rate and far less waste stripping, in addition to reduces assumptions for your Canadian dollar and fuel costs.
Desjardins Securities analyst Michael Parkin noted the brand new plan’s missing some specifics. But he still hiked his price target to $18.50 a share (from $17.50) while he is confident the newest targets is possible.
“With management providing reliable guidance last year, we’ve good conviction inside our revised estimates,” he was quoted saying in the note.
BMO Capital Markets analyst Brian Quast realized that the reduced mining rate reduces risk by lowering capital requirements and “generally moderating” the work. He boosted his target price 4.3 % to $16 a share.
At least eight sell-side analysts have risen their targets on Detour since the announcement.
