Source: The Gold Report
May 17, 2017 (Investorideas.com Newswire) The Critical Investor examines Tinka Resources, which has found high levels of zinc in the first holes of a new exploration program.
A share price target is something of a stretch at this early stage, but as Arizona Mining already traded at close to half NPV8 @ US$1.10/lb Zn before the PEA came out and before its (largely unjustified as they had to be more transparent about the presence of deleterious elements, but penalties are very unlikely to materially impact economics) manganese penalty circus started, there seems to be enough room to appreciate on a larger resource. As economics of Ayawilca look destined to be very good, there is no doubt in my mind that the surrounding producers are fixated on any drill results being published by Tinka, probably feeding them enthusiastically to their own models. With zinc fundamentals being strong well into 2018, a possible take over doesn't seem unrealistic at all, and I would be surprised if Tinka is still around at the end of 2018.
Tinka Resources is rapidly turning into the market darling of zinc juniors, as the first drill results already look very promising, and indicate a strongly mineralized South Zone as anticipated by management. However, this seems to be only the beginning of stepout drilling, and my expectations for especially Zone 3 are equally substantial, and could elevate Tinka into the realm of Tier I asset owners, and would likely generate interest from nearby suitors by doing so.
It is the possible exploration upside combined with possible future economics that will make the big difference here, as mining in Peru is much cheaper than in most of the other peer's jurisdictions. As the possible resource update comes out depending on outcomes of the current drill program and a PEA shortly after this, this will be the time for Tinka Resources to really set itself apart from peers in my view. It looks like 2017 is shaping up to be an exciting year for Tinka, and I would suggest to at least follow it closely from now on.
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The Critical Investor Disclaimer:
The author is not a registered investment advisor, and has a long position in this stock, Emerita Resources and Darnley Bay. Tinka Resources is a sponsoring company. The views, opinions, estimates or forecasts regarding Tinka's performance are those of the author alone and do not represent opinions, forecasts or predictions of Tinka or Tinka's management. Tinka has not in any way endorsed the information, conclusions or recommendations provided by the author.
All facts are to be checked by the reader. For more information go to https://www.tinkaresources.com/www.tinkaresources.com and read the company's profile and official documents on www.sedar.com, also for important risk disclosures. This article is provided for information purposes only, and is not intended to be investment advice of any kind, and all readers are encouraged to do their own due diligence, and talk to their own licensed investment advisors prior to making any investment decisions.
The Critical Investor is a newsletter and comprehensive junior mining platform, providing analysis, blog and newsfeed and all sorts of information about junior mining. The editor is an avid and critical junior mining stock investor from The Netherlands, with an MSc background in construction/project management. Number cruncher at project economics, looking for high quality companies, mostly growth/turnaround/catalyst-driven to avoid too much dependence/influence of long term commodity pricing/market sentiments, and often looking for long term deep value. Getting burned in the past himself at junior mining investments by following overly positive sources that more often than not avoided to mention (hidden) risks or critical flaws, The Critical Investor learned his lesson well, and goes a few steps further ever since, providing a fresh, more in-depth, and critical vision on things, hence the name.
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