Analyst Kevin O’Halloran of BMO Capital reiterated a Buy rating on Discovery Silver, retaining the price target of C$4.50.
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Kevin O’Halloran has given his Buy rating due to a combination of factors that highlight Discovery Silver’s strong financial and operational performance. The company reported significantly higher production figures than expected, with Q2 attributable production reaching 50.5koz, surpassing both BMO’s estimate and consensus. This was achieved through higher throughput and grade, particularly at the Porcupine gold complex, which Discovery Silver began operating from mid-April.
Moreover, Discovery Silver’s financial health is robust, with a cash flow from operations of $67 million and free cash flow of $27 million, both exceeding expectations. The company’s site-level all-in sustaining costs (AISC) were also lower than anticipated, indicating efficient cost management. Additionally, Discovery Silver ended the quarter with a strong cash balance and has access to further liquidity through an undrawn debt facility. These factors, combined with the long-term production potential of both the Porcupine and Cordero projects, support the Buy rating.
Based on the recent corporate insider activity of 66 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of DSVSF in relation to earlier this year.