Discover Why The Lassonde Curve Is Pointing Euro Sun Mining In The Direction Of A Massive Re-Rate
The location of a major gold mining project is critical.
A company can be sitting on the biggest metal resource in the world, but it doesn’t mean a thing if local law and civil unrest prevent its development.
There’s a reason why high-quality projects are so rare in the world’s most attractive mining jurisdictions – most of them have already been taken!
Institutional investors flock to back deposits of mineralization in safe regions, which promote natural resources development, because they know this gives them the best chance of developing a mine.
This maximizes their chances of seeing a giant-sized return on investment.
Without doubt, one of the best jurisdictions to build a mine is the European Union.
Not only do countries in the trading bloc boast advanced infrastructure and pro-mining laws, but also the E.U. framework establishes cross-border political stability and heavily promotes foreign direct investment.
And this exciting opportunity could be about to make investors a great deal of money.
DOWNLOAD OUR SPECIAL REPORT for a deep dive into why institutional investors are flocking to Euro Sun Mining and why this stock could soar (TSX:ESM | OTCQB:CPNFF)
From a geological perspective, Romania is hugely prospective. The area where Rovina Valley sits is known as the “Golden Quadrilateral”. It is one of Europe’s largest gold-producing regions, with more than 55 million ounces (“Moz”) having been pulled out of the ground since since Roman times.
Despite this, Romania hasn’t made much of a meaningful impact on the global mining investment world because state-owned businesses have dominated the development of its vast resources.
Today this is changing.
Since joining the European Union in 2007, Romania’s compliance with the trading bloc’s rules and obligations has fostered a culture of improved governance principals at the state level. Over the years, this has created a friendly and incentive-based economic environment that has encouraged more and more international business.
Soaring levels of foreign direct investment continue to propel Romania forward, and the country is currently on track to deliver the second-highest EU country GDP growth in 2020 and 2021.
Against this backdrop, the floodgates for foreign investment into the country’s highly attractive mining industry have opened. And the catalyst was none other than Euro Sun Mining (TSX:ESM | OTCQB:CPNFF)!
In 2018, this company became the first-ever non-state-owned business to win a mining license from the Romanian government.
WINNERS TO WATCH
Euro Sun (TSX:ESM | OTCQB:CPNFF) was able to succeed where others had failed, by approaching the development of Rovina Valley with a deeply-held commitment to sustainable Environmental, Societal, and Governmental (“ESG”) principles:
No cyanide will be used at Rovina Valley, and dry stack tailings will be used rather than wet tailings to reduce visual impact and water usage.
The company will re-use existing infrastructure left over by the nearby, historic Barza mine, use renewable power sources, and confirm the absence of archaeological remains.
Local communities will be engaged throughout Rovina Valley’s development and production to provide hundreds of jobs and remain the need for community resettlement.
Looking further forward, the support of the Romanian government opens the doors wide for the firm when it comes to future mining opportunities in Europe’s newest mining investment destination.
As recently as May 2020, the company upsized a bought deal public offering from C$12 million to C$20 million in response to extreme demand – it eventually raised C$22.3 million.
As a result of this, Euro Sun (TSX:ESM | OTCQB:CPNFF) now counts leading UK fund manager Ruffer as its leading shareholder with a 9% position. With the likes of Franklin Templeton and ASA Gold and Precious Metals also taking large stakes in the raise, close to a third of the company’s share capital now sits in institutional hands.
But it’s not just the firm’s location and permitting progress that has got these individuals excited; it’s also Rovina Valley’s quality.
The project hosts 10.11 million ounces of gold in the highly prized Measured and Indicated resources categories spread across three pits – Colnic, Rovina, and Ciresata. This makes it Europe’s second-largest gold deposit.
Meanwhile, Euro Sun (TSX:ESM | OTCQB:CPNFF) has also taken great steps to demonstrate the economic viability of its project. A preliminary economic assessment in 2019 gave the Colnic pit alone a pre-tax net present value (“NPV(5)”) of US$228.1 million and an internal rate of return of 15.4% at US$1,325/oz gold.
At today’s >US$1,900/oz spot price, this NPV5 increases to more than US$700 million – and that’s not even factoring in the value of the Rovina deposit, which will be developed sequentially!
THE LASSONDE CURVE
With Euro Sun (TSX:ESM | OTCQB:CPNFF) on track to complete the remaining feasibility and development needed to become “shovel ready” by next year, its current C$0.47 share price and C$78.6 million market cap present an exciting opportunity.
The Lassonde Curve uses historical data to map out the typical valuation journey that mining projects take throughout their lifecycle – from early stage exploration to full mine development.
Euro Sun’s position on The Lassonde Curve
According to the Lassonde Curve, the recent institutional investment in Euro Sun (TSX:ESM | OTCQB:CPNFF) puts it on track for a massive re-rate as more heavyweight investors buy in throughout Rovina Valley’s construction and production.
And as if this was not enough, the company is entering this period at a time when gold stocks of every description are being propelled forward by the highest prices for the precious yellow metal ever seen.
Year-to-date, the Euro Sun (TSX:ESM | OTCQB:CPNFF) share price is up by nearly 70%. But with its rooting in a pro-mining European jurisdiction, ground-breaking state support, vast gold resource, and impressive institutional backing, this stock looks set to fly much higher.
For an in-depth look into why the Lassonde curve is pointing Euro Sun Mining in the direction of a massive re-rate, DOWNLOAD AND READ OUR EXCLUSIVE REPORT (TSX:ESM | OTCQB:CPNFF)
IMPORTANT NOTICE AND DISCLAIMER
This communication is a paid advertisement. ValueTheMarkets is a trading name of Digitonic Ltd, and its owners, directors, officers, employees, affiliates, agents and assigns (collectively the “Publisher”) is often paid by one or more of the profiled companies or a third party to disseminate these types of communications. In this case, the Publisher has been compensated by Euro Sun Mining to conduct investor awareness advertising and marketing and has paid the Publisher the equivalent of one hundred thousand and twelve thousand US dollars to produce and disseminate this and other similar articles and certain related banner advertisements. This compensation should be viewed as a major conflict with the Publisher’s ability to provide unbiased information or opinion.
CHANGES IN SHARE TRADING AND PRICE
Readers should beware that third parties, profiled companies, and/or their affiliates may liquidate shares of the profiled companies at any time, including at or near the time you receive this communication, which has the potential to adversely affect share prices. Frequently companies profiled in our articles experience a large increase in share trading volume and share price during the course of investor awareness marketing, which often ends as soon as the investor awareness marketing ceases. The investor awareness marketing may be as brief as one day, after which a large decrease in share trading volume and share price may likely occur.
NO OFFER TO SELL OR BUY SECURITIES
This communication is not, and should not be construed to be, an offer to sell or a solicitation of an offer to buy any security.
Neither this communication nor the Publisher purport to provide a complete analysis of any company or its financial position.
This communication is based on information generally available to the public and on an interview conducted with the company’s CEO, and does not contain any material, non public information. The information on which it is based is believed to be reliable. Nevertheless, the Publisher does not guarantee the accuracy or completeness of the information. Further, the information in this communication is not updated after publication and may become inaccurate or outdated. No reliance should be placed on the price or statistics information and no responsibility or liability is accepted for any error or inaccuracy. Any statements made should not be taken as an endorsement of analyst views.
NO FINANCIAL ADVICE
The Publisher is not, and does not purport to be, a broker-dealer or registered investment adviser or a financial adviser. The Publisher has no access to non-public information about publicly traded companies. The information provided is general and impersonal, and is not tailored to any particular individual’s financial situation or investment objective(s) and this communication is not, and should not be construed to be, personalized investment advice directed to or appropriate for any particular investor or a personal recommendation to deal or invest in any particular company or product. Any investment should be made only after consulting a professional investment advisor and only after reviewing the financial statements and other pertinent corporate information about the company. Further, readers are advised to read and carefully consider the Risk Factors identified and discussed in the advertised company’s SEC, SEDAR and/or other government filings. Investing in securities, particularly microcap securities, is speculative and carries a high degree of risk. Past performance does not guarantee future results.
FORWARD LOOKING STATEMENTS
This communication contains forward-looking statements, including statements regarding expected continual growth of the featured companies and/or industry. Statements in this communication that look forward in time, which include everything other than historical information, are based on assumptions and estimates by our content providers and involve risks and uncertainties that may affect the profiled company’s actual results of operations. These statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results and performance to differ materially from any future results or performance expressed or implied in the forward-looking statements. These risks, uncertainties and other factors include, among others: the success of the profiled company’s operations; the size and growth of the market for the company’s products and services; the company’s ability to fund its capital requirements in the near term and long term; pricing pressures; changes in business strategy, practices or customer relationships; general worldwide economic and business conditions; currency exchange and interest rate fluctuations; government, statutory, regulatory or administrative initiatives affecting the company’s business.
INDEMNIFICATION/RELEASE OF LIABILITY
By reading this communication, you acknowledge that you have read and understand this disclaimer in full, and agree and accept that the Publisher provides no warranty in respect of the communication or the profiled company and accepts no liability whatsoever. You acknowledge and accept this disclaimer and that, to the greatest extent permitted under applicable law, you release and hold harmless the Publisher from any and all liability, damages, injury and adverse consequences arising from your use of this communication. You further agree that you are solely responsible for any financial outcome related to or arising from your investment decisions.
All trademarks used in this communication are the property of their respective trademark holders. Other than valuethemarkets.com, the Publisher is not affiliated, connected, or associated with, and the communication is not sponsored, approved, or originated by, the trademark holders unless otherwise stated. No claim is made by the Publisher to any rights in any third-party trademarks other than valuethemarkets.com.
valuethemarkets.com and Digitonic Ltd and our affiliates are not responsible for the content or accuracy of this article. The information included in this article is based solely on information provided by the company or companies mentioned above. This article does not provide any financial advice and is not a recommendation to deal in any securities or product. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance.
ValueTheMarkets do not hold any position in the stock(s) and/or financial instrument(s) mentioned in the above piece. ValueTheMarkets have been paid to produce this piece by the company or companies mentioned above. Digitonic Ltd, the owner of valuethemarkets.com, has been paid for the production of this piece by the company or companies mentioned above.