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TICKERS: SEA; SA

New US$150 Million Deal Will Support Gold Co. In Achieving Project Designation Well Before Due Date
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The US$150 million Seabridge Gold Inc. will receive from this deal will be used to finish physical work at the site that Kozak expects "will support Seabridge achieving the "substantially started" project designation well before the July 2026 date required by the B.C. government to keep its Environmental Assessment Certificate (EAC) valid for the life of the project," noted a May 12, Cantor Fitzgerald report.

Seabridge Gold Inc. (SEA:TSX; SA:NYSE.MKT) recently announced it would be raising US$150 million royalty deal from Sprott Resource Streaming and Royalty, noted Mike Kozak in a Cantor Fitzgerald research note.

This was completed via the sale of a 1.2% net smelter return royalty on all metals production at KSM in the future. 

In this research note, Kozak stated, "We have a favorable view of this transaction as it removes a significant financing overhang in a way that is not equity dilutive to shareholders."

Kozak also pointed out that the US$150 million, besides the US$225 million raised the previous year, will be used to finish physical work at the site that Kozak expects "will support Seabridge achieving the "substantially started" project designation well before the July 2026 date required by the B.C. government to keep its Environmental Assessment Certificate (EAC) valid for the life of the project."

Integrating the 1.2% minimizes Kozak's DCF-based NPV on KSM from US$7.22 billion to US$7.01 billion, "effectively net-neutral after adding back the US$0.15 billion" Seabridge will earn from this NSR sale.

Structure and Predictions

From this news, Cantor Fitzgerald reiterated its Buy rating on Seabridge Gold, with a target of US$33.50 / CA$42.

Kozak's research also shares current market data on the company:

  • Rating: Buy
  • Price: US$15.17/ CA$20.47, with a 52-week range of US$10.03 and US$16.18
  • Price Target: US$33.50 / CA$42
  • Market Cap: US$1,250

Kozak expects a projected return to target of 105.2% for shareholders. Seabridge has US$248 million in cash and cash equivalents and 82.4 million outstanding shares.  


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Important Disclosures:

  1. Katherine DeGilio wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. 
  2. The following companies mentioned in this article are billboard sponsors of Streetwise Reports: Seabridge Gold Inc. Click here for important disclosures about sponsor fees. 
  3. The 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.
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Disclosures for Cantor Fitzgerald, Seabridge Gold Inc., May 12, 2023

Disclaimers The opinions, estimates and projections contained in this report are those of Cantor Fitzgerald Canada Corporation. (“CFCC”) as of the date hereof and are subject to change without notice. Cantor makes every effort to ensure that the contents have been compiled or derived from sources believed to be reliable and that contain information and opinions that are accurate and complete; however, Cantor makes no representation or warranty, express or implied, in respect thereof, takes no responsibility for any errors and omissions which may be 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 Cantor that is not herein. This report is provided, for informational purposes only, to institutional investor clients of CFCC, and does not constitute an offer or solicitation to buy or sell any securities discussed herein in any jurisdiction where such offer or solicitation would be prohibited. This report is issued and approved for distribution in Canada, Cantor Fitzgerald Inc., a member of the Investment Industry Regulatory Organization of Canada ("IIROC"), the Toronto Stock Exchange, the TSX Venture Exchange and the CIPF. This report is has not been reviewed or approved by Cantor Fitzgerald & Co., a member of FINRA. This report is intended for distribution in the United States only to Major Institutional Investors (as such term is defined in SEC 15a-6 and Section 15 of the Securities Exchange Act of 1934, as amended) and is not intended for the use of any person or entity that is not a major institutional investor. Major Institutional Investors receiving this report should effect transactions in securities discussed in the report through Cantor Fitzgerald & Co.

Non US Broker Dealer 15a-6 disclosure: This report is being distributed by (CF Canada/CF Europe/CF Hong Kong) in the United States and is intended for distribution in the United States solely to “major U.S. institutional investors” (as such term is defined in Rule15a-6 of the U.S. Securities Exchange Act of 1934 and applicable interpretations relating thereto) and is not intended for the use of any person or entity that is not a major institutional investor. This material is intended solely for institutional investors and investors who Cantor reasonably believes are institutional investors. It is prohibited for distribution to non-institutional clients including retail clients, private clients and individual investors. Major Institutional Investors receiving this report should effect transactions in securities discussed in this report through Cantor Fitzgerald & Co. This report has been prepared in whole or in part by research analysts employed by non-US affiliates of Cantor Fitzgerald & Co that are not registered as broker-dealers in the United States. These non-US research analysts are not registered as associated persons of Cantor Fitzgerald & Co. and are not licensed or qualified as research analysts with FINRA or any other US regulatory authority and, accordingly, may not be subject (among other things) to FINRA’s restrictions regarding communications by a research analyst with a subject company, public appearances by research analysts, and trading securities held by a research analyst account. Potential conflicts of interest The author of this report is compensated based in part on the overall revenues of Cantor, a portion of which are generated by investment banking activities. Cantor may have had, or seek to have, an investment banking relationship with companies mentioned in this report. Cantor and/or its officers, directors and employees may from time to time acquire, hold or sell securities mentioned herein as principal or agent. Although Cantor makes every effort possible to avoid conflicts of interest, readers should assume that a conflict might exist, and therefore not rely solely on this report when evaluating whether or not to buy or sell the securities of subject companies.

Disclosures as of May 12, 2023 Cantor has provided investment banking services or received investment banking related compensation from Seabridge Gold Inc. within the past 12 months. The analysts responsible for this research report do not have, either directly or indirectly, a long or short position in the shares or options of Seabridge Gold Inc. The analyst responsible for this report has visited the material operations of Seabridge Gold Inc. (KSM and Iskut). No payment or reimbursement was received for the related travel costs.

Analyst certification The research analyst whose name appears on this report hereby certifies that the opinions and recommendations expressed herein accurately reflect his personal views about the securities, issuers or industries discussed herein.





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