EMX Royalty, the Basic Materials sector company, was revisited by a Wall Street analyst today. Analyst Heiko Ihle from H.C. Wainwright reiterated a Buy rating on the stock and has a $5.75 price target.
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Heiko Ihle has given his Buy rating due to a combination of factors surrounding the merger between EMX Royalty and Elemental Altus Royalties. The merger is set to create a mid-tier gold-focused royalty company, which is expected to have 16 producing royalties and a projected revenue of $70 million by 2026. This strategic move is anticipated to enhance EMX’s market position and provide shareholders with a premium on their shares, alongside continued exposure to EMX’s legacy assets.
Additionally, the merger offers EMX investors increased diversification through access to Tier 1 Australian gold assets, with a significant portion of revenue derived from precious metals. The financing arrangement accompanying the merger, involving a $100 million investment by Tether Investments, is intended to repay EMX’s credit facility and support future growth initiatives. Ihle’s valuation of EMX is based on discounted cash flows from key royalty interests and the potential upside from Elemental’s development-stage pipeline, justifying the Buy rating and a price target of $5.75.
Ihle covers the Basic Materials sector, focusing on stocks such as Gold Resource, Americas Gold and Silver, and Integra Resources Corp. According to TipRanks, Ihle has an average return of 35.7% and a 69.17% success rate on recommended stocks.