Get the Latest Investment Ideas Delivered Straight to Your Inbox. Subscribe


Exploration Project on Track To Reach Milestones in 2023
Research Report

Share on Stocktwits


"Significant" news flow from the Spanish polymetallic property should lead to a "strong rerating" of the company, noted a Clarus Securities report.

Emerita Resources Corp.'s (EMO:TSX.V; EMOTF:OTCMKTS; LLJ:FSE) Iberian Belt West (IBW) project in Spain is "set to deliver great news flow and likely surprise investors to the upside," Varun Arora, Clarus Securities analyst, reported in a Dec. 7 research note after a site visit.

"Significant IBW news flow should drive [a] strong rerating," Arora added. "Many mile markers will be passed in 2023 on the way to demonstrating IBW has what it takes to be a mine."

Good Time To Buy

Emerita is currently priced at about CA$0.79, and Clarus' target price on the stock is CA$4 per share, Arora indicated. The difference between these two amounts represents a remarkable, 406%, possible return for Emerita investors. In the most conservative of cases, the analyst pointed out, the potential for at least a 100% return exists.

The CA$4 target price is new, recently lowered from CA$5 when Clarus updated its valuation model on the company, Arora noted. Clarus revised its assumptions after the trial date concerning the ongoing dispute over the Aznalcóllar bid, in which Emerita is involved, was recently set for March 2025.

"We expect significant option value (about CA$2.75–$3 per share) to start showing in the share price as the trial date approaches," wrote Arora.

Clarus rates Emerita Speculative Buy.

"A disconnect due to the Aznalcóllar trial timing, management's messaging around the proceedings and tax loss selling is creating a buying opportunity," Arora purported.

Major Milestones Near

Emerita is on track to release a maiden resource for IBW in Q2/23. Encompassing only Romanera and La Infanta, the initial resource estimate could be as much as 20,000,000 tons of 10–12% zinc equivalent, Arora highlighted.

Later, in H2/23, Emerita is expected to release metallurgical test results and follow with a prefeasibility study by year-end 2023.

Continual News Expected

Along with this milestone news on the horizon, a long stream of drill and exploration results is expected from multiple targets at IBW given 14 rigs are active there, Arora wrote and noted the work Emerita is doing now and plans to do in the near term. 

There will be drill results from Romanera and La Infanta, from at least 60 holes, half of which are completed and the remainder are underway. All will be included in the upcoming maiden resource. There is even further resource expansion potential from these two deposits as they remain open.  

"Not all the mineralized area will make it into an underground resource, but with the current mineralized area being about two times the historic area, the chance of adding significant tonnage at Romanera seems high," wrote Arora.

There also will be results of exploration work at El Cura and Nuevo Tintillo. Emerita plans to start drilling at El Cura and Nuevo Tintillo's Santa Flora in Q1/23.

Further, should Emerita decide to also drill the regional targets it has identified, results from those efforts would add to the news flow.

Want to be the first to know about interesting Gold, Base Metals and Silver investment ideas? Sign up to receive the FREE Streetwise Reports' newsletter. Subscribe

1) Doresa Banning wrote 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.

2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: Emerita Resources Corp. Click here for important disclosures about sponsor fees. As of the date of this article, an affiliate of Streetwise Reports has a consulting relationship with: None. Please click here for more information.

3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.

4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. 

Disclosures For Clarus Securities Inc., Emerita Resources Corp., December 7, 2022

Clarus Securities Equity Research Disclosures: The analyst has visited the Company’s operations in Spain in November 2021. Partial payment or reimbursement was received from the issuer for the associated travel costs. Within the last 24 months, Clarus Securities Inc. has managed or co-managed a public offering of securities of this company. Within the last 24 months, Clarus Securities Inc. has received compensation for investment banking services with respect to the securities of this company.

General Disclosure: The information and opinions in this report were prepared by Clarus Securities Inc. (“Clarus Securities”). Clarus Securities is a whollyowned subsidiary of Clarus Securities Holdings Ltd. and is an affiliate of such. The reader should assume that Clarus Securities or its affiliate may have a conflict of interest and should not rely solely on this report in evaluating whether or not to buy or sell securities of issuers discussed herein. The opinions, estimates and projections contained in this report are those of Clarus Securities as of the date of this report and are subject to change without notice. Clarus Securities endeavours to ensure that the contents have been compiled or derived from sources that we believe are reliable and contain information and opinions that are accurate and complete. However, Clarus Securities makes no representation or warranty, express or implied, in respect thereof, takes no responsibility for any errors and omissions contained herein and accepts no liability whatsoever for any loss arising from any use of, or reliance on, this report or its contents. Information may be available to Clarus Securities or its affiliate that is not reflected in this report. This report is not to be construed as an offer or solicitation to buy or sell any security. No part of this report may be reproduced or re-distributed without the written consent of Clarus Securities.

Conflicts of Interest: The research analyst and/or associates who prepared this report are compensated based upon (among other factors) the overall profitability of Clarus Securities and its affiliate, which includes the overall profitability of investment banking and related services. In the normal course of its business, Clarus Securities or its affiliate may provide financial advisory and/or investment banking services for the issuers mentioned in this report in return for remuneration and might seek to become engaged for such services from any of such issuers in this report within the next three months. Clarus Securities or its affiliate may buy from or sell to customers the securities of issuers mentioned in this report on a principal basis. Clarus Securities, its affiliate, and/or their respective officers, directors or employees may from time to time acquire, hold or sell securities discussed herein, or in related securities or in options, futures or other derivative instruments based thereon.

Analyst’s Certification: Each Clarus Securities research analyst whose name appears on the front page of this research report hereby certifies that (i) the recommendations and opinions expressed in the research report accurately reflect the research analyst’s personal views about the Company and securities that are the subject of this report and all other companies and securities mentioned in this report that are covered by such research analyst and (ii) no part of the research analyst’s compensation was, is, or will be directly or indirectly, related to the specific recommendations or views expressed by such research analyst in this report.

Want to read more about Gold, Base Metals and Silver investment ideas?
Get Our Streetwise Reports' Resources Report Newsletter Free and be the first to know!

A valid email address is required to subscribe