DESCRIPTION: Fortuna is a growth-oriented, silver and base metal producer focused on mining opportunities in Latin America. The company owns a producing mine, a project in the advanced-development stage and has a strong cash position. Fortuna's primary assets are the 100%-owned Caylloma silver/lead/zinc mine in Peru and the 100%-owned San Jose silver/gold project in southern Mexico. The company is selectively pursuing additional acquisition opportunities.
The information provided below is based on the most recent information we have received from analysts, newsletters and other contributors to Streetwise Reports' The Gold Report or The Energy Report. We encourage you to visit the company's web site and call the company for more specifics on this company before you decide to invest.
"Fortuna Silver was buoyed by a stronger silver price and new drill results from the Don Luis II vein, located in the undeveloped western portion of the Caylloma Mine. . .in Southern Peru where no prior development or mining has taken place. A Bay Street analyst deemed these results a 'slight positive' as the development should bump up average silver grades and boost annual production over time. The vein outcrops over a strike length of ~400m and ranges from approximately 1m–3m in width at the surface. Twelve diamond drill holes totaling 2,283m have been completed to test the vein from near surface to approximately 200m depth. Highlight holes include: DLUS000110, which intersected 816 g/t Ag and 0.27 g/t Au over 3.05m from 148.75m; DLUS000410, which intersected 864 g/t Ag and 0.07 g/t Au over 0.50m from 93.30m; DLUS000910, which intersected 639 g/t Ag and 0.18 g/t Au over 3.40m from 232.90m. . .Fortuna Silver is one of Canaccord Genuity Mining Analyst Nicholas Campbell's top picks based on: 1) Organic growth profile; 2) Solid balance sheet and consistent cash flows; and 3) Attractive valuation. He expects this company to gain broader investor attention, which should lead to a revaluation in line with other junior precious metal producers."
Sean Rakhimov, Silver Strategies (08/31/10)
"Fortuna is another junior silver producer that is coming into its own as it gears up to start production from its San Jose mine in Mexico later this year. Already sporting a very attractive P/E, Fortuna is living up to its name and looks poised to make a fortune for its shareholders in the near future. It should record another significant bump up next year when San Jose starts contributing to the bottom line. We reckon the reason why both FR and FVI are overlooked by investors is their relatively small market cap, short profitability track record and absence of listing on a major U.S. exchange. But that is changing before your eyes so don't expect these two companies to be valued as they are presently beyond this year."
Andrew Kaip, BMO Capital Markets
(08/30/10)
"Fortuna Silver Mines announced results from initial drilling in the Don Luis II vein at the Caylloma Mine, located ~225 km. NW of Arequipa in Southern Peru. FVI has drilled 12 wide-spaced holes over a strike length of 2.3 km. and to a depth of 200m in the Don Luis II vein. Significant results include 816 g/t silver over true width of 2m, 639 g/t silver over true width of 3.4m and 621 g/t silver over true width of 1m. Mineralization remains open laterally and at depth. The Caylloma district contains more than 30 known veins over 10,200 ha. Historically, six veins have been exploited with current mining operations focused on the Animas, Bateas and Soledad veins. Contingent upon further infill drilling, results from the Don Luis II vein highlight the potential to identify new high-grade production areas over time. Based on current reserves and resources, BMO models a ~10-year mine life. During H110, the Caylloma mine produced ~950 Koz. silver. FVI trades at 1.0x the 10% nominal NPV at spot metal prices vs. junior producer peers within the BMO Research silver universe that trade at 1.1x."
Wayne Hewgill, PI Financial Corp.
(08/30/10)
"Fortuna Silver released the initial drill results from the Don Luis II vein on the western portion of the Caylloma property in Southern Peru. The new discovery located ~4 km. from the Caylloma mill site, demonstrates the potential of the new area that currently has no mine development land. Highlights include intervals of 3.05m (estimated true width 1.97m) grading 816 g/t Ag and 0.27 g/t Au starting at a depth of 148m and 0.91m grading 255 g/t Ag and 2.58 g/t Au.
We are maintaining our BUY recommendation and are increasing our 12-month target price to $2.70 (from $2.45) to account for the confirmation of the exploration potential on the west side of the Caylloma project."
Greg McCoach, Mining Speculator
(08/30/10)
"Shares of FVI have pushed higher once again as silver prices look very robust going into the fall season. The company continues to bring good news with the latest second quarter results and which confirms to investors the value of this position. Second quarter 2010 highlights: Net income of $5.98M, compared with a net loss of $1.2M in Q209; revenue of $14.57M, compared with $12.86M in the Q209; operating income of $6.97M, compared with $4.36M in Q209; cash flow from operations before changes in non-cash working capital of $4.58M, compared with $4.02M in Q209; silver production of 470,310 oz., a 5% increase over Q209; cash cost per silver ounce, net of byproduct credits, of -$5.23; cash position, including short-term investments and working capital, as [of] June 30, 2010, totaled $64.94M, compared with $71.73M in the same period last year."
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