Dolly Varden Silver Corp. (DV:TSX.V; DOLLF:OTCQX) attracted the interest of another investment firm; Haywood Securities initiated analyst coverage on it with a recommendation to accumulate shares at current levels, reported analyst Geordie Mark in an October 21, 2022 research note.
"We believe that now is the right time for leverage in precious metals through investment in Dolly Varden Silver," Mark wrote.
Projected Return of 142%
Haywood calculated a CA$1.60 per share price target on Buy-rated Dolly Varden Silver, the current share price of which is CA$0.69. This gap represents a significant projected return for investors of 142%. Upcoming catalysts include additional drill results this year, along with even more drill results and an updated resource estimate next year.
"We see multifaceted opportunities for Dolly Varden [Silver], which has clear value accretion and rerating equity potential over the near to midterm on drill bit and other related news," he wrote.
Unique Metals Endowment
Mark highlighted the significant elements of the Dolly Varden Silver story. One is the mining explorer's combination of recently consolidated assets in the tier 1 jurisdiction of British Columbia's Golden Triangle. This package, or the Kitsault Valley project, includes the Dolly Varden (former mine) high-grade silver deposit on one end of the property and the Homestake deposit and high-grade gold on the opposite end, with "a chemical variant" in between.
With its high-grade silver and gold assets in an excellent mining jurisdiction, prospects for future growth and discovery, and a current resource sufficient for a mining operation, Mark purported, Vancouver-based Dolly Varden Silver is an investment to consider at this time.
"The high-grade silver facet to the asset portfolio provides an added differentiator within the subgroup of development-stage companies," Mark noted.
Also, it "lifts the narrative and value of the assets given the attractiveness of the silver producer peer group that trades at premiums materially higher than their gold-oriented brethren, offering enhanced mergers and acquisitions competition."
Potential With Existing Resources
Together, Dolly Varden Silver's current resources host 71,000,000 ounces (71 Moz) of silver and 1 Moz of gold. Individually, the global resource at Dolly Varden is 4,700,000 tons (4.7 Mt) of 295 grams per ton (295 g/t) silver containing 51,000,000 ounces (51 Moz) of silver. The global resource at Homestake is 6.3 Mt of 4.87 g/t gold and 96 g/t silver, hosting 1 Moz of gold and 19.6 Moz of silver.
"The company has now amassed a resource base that we believe is sufficient to underpin a smaller scale, conventional underground mining, and processing operation," Mark wrote.
Haywood envisions a 12.5-year mine producing 100,000 ounces of gold equivalent (Au eq) per year at an all-in-sustaining cost of US$838 per Au eq ounce. In the meantime, the mining company will continue with its aggressive exploration. It recently upgraded its 2022 drill program to 35,000 meters and took the active drill rig count to four.
Developing the Geological Picture
Also noteworthy about Dolly Varden Silver, Mark pointed out, is the work it is now doing — soil and rock geochemistry, mapping and structural analysis, and geophysics to drill targeting and resource infill and expansion — "to fully integrate systems information across the deposits to expand known systems and discover new systems more effectively," Mark wrote.
Dolly Varden Silver is well cashed up to advance its Kitsault Valley project, having $22.2 million ($22.2M) in cash and cash equivalents, along with $6M in warrants.
Big-Name Shareholders and Coverage
In terms of Dolly Varden Silver's leadership, heading the company as chief executive officer (CEO), president, and director, Mark indicated, is Shawn Khunkhun, an executive experienced in capital markets and mining exploration and development with expertise in enhancing shareholder value. The vice president of exploration is Rob Van Egmond, who has 25 years of worldwide experience in the mining industry.
Dolly Varden is covered by Agentis Capital, Haywood Securities, and Research Capital Corp., as well as newsletter writers Maurice Jackson, The Critical Investor, Clive Maund, Rick Mills, and Bob Moriarty. Click "See More Live Data" in the data box above to read what they are saying.
Dolly Varden Silver's board of directors includes Robert McLeod, a professional geoscientist; Tim Clark, CEO and director of Fury Gold Mines; Michael Henrichsen, senior vice president of exploration for Fury; and James Sabala, former senior vice president, and chief financial officer of Hecla Mining.
Fury, Hecla, and Sprott are some of the major shareholders of Dolly Varden Silver. Its management and insiders own 8% of the company.
Dolly Varden is covered by Agentis Capital, Haywood Securities, and Research Capital Corp., as well as newsletter writers Maurice Jackson, The Critical Investor, Clive Maund, Rick Mills, and Bob Moriarty. Click "See More Live Data" in the data box above to read what they are saying.
With its high-grade silver and gold assets in an excellent mining jurisdiction, prospects for future growth and discovery, and a current resource sufficient for a mining operation, Mark purported, Vancouver-based Dolly Varden Silver is an investment to consider at this time.
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Disclosures:
1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
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Disclosures For Haywood Capital Markets, Dolly Varden Silver Corp., October 21, 2022
This report is intended for institutional investors and may only be distributed to non-institutional US clients in the following states: Alaska, Arkansas, Colorado, Connecticut, Delaware, Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Nebraska, New Jersey, New Mexico, New York, North Dakota, Ohio, Oregon, Pennsylvania, Rhode Island, South Dakota, Tennessee, Texas, Vermont, Virgin Islands, Washington, West Virginia, Wisconsin, Wyoming. Otherwise, this report may only be distributed into those states with an institutional buyer state securities registration exemption.
Analyst Certification: I, Geordie Mark, hereby certify that the views expressed in this report (which includes the rating assigned to the issuer’s shares as well as the analytical substance and tone of the report) accurately reflect my/our personal views about the subject securities and the issuer. No part of my/our compensation was, is, or will be directly or indirectly related to the specific recommendations.
Important Disclosures: Of the companies included in the report the following Important Disclosures apply:
- Haywood Securities, Inc. has reviewed lead projects of Dolly Varden Silver Corp. (DV-V), Artemis Gold Inc. (ARTG-V) and a portion of the expenses for this travel may have been reimbursed by the issuer.
- Haywood Securities Inc. or one of its subsidiaries has managed or co-managed or participated as selling group in a public offering of securities for Dolly Varden Silver Corp. (DV-V), Artemis Gold Inc. (ARTG-V) in the last 12 months.
- Haywood Securities, Inc. or one of its subsidiaries has received compensation for investment banking services from Dolly Varden Silver Corp. (DV-V), Artemis Gold Inc. (ARTG-V) in the past 24 months.
