A deep analysis on a strong company is always invaluable information for any junior mining investor, whether independent or professional, and the initial investment report by Eight Capital on White Gold Corp is no exception.
Eight Capital is a full-service Canadian investment dealer based in Toronto, Canada, with deep expertise in both mining and capital markets. White Gold Corp (V.WGO) continues to be a leading gold explorer operating in the prolific White Gold District of Yukon, Canada, with the assets, projects and success of multiple mining juniors, all contained in a single company.
WGO has multiple brand new gold discoveries, over 1.039M Indicated & 508k Inferred gold ounces in its Golden Saddle & Arc deposits, and 230k Inferred gold ounces in its VG deposit, over 400,000+ soil samples across the district, and a pipeline of new gold targets identified across its 33 properties covering over a million acres with several recent high grade discoveries already delivered through the Company’s proprietary exploration methodologies.
The standard junior mining press release may work for a single project explorer, but a company with as many assets and strengths like White Gold Corp truly shines in a deeper investment analysis.
Eight Capital’s report leads with a great summary of the company:
“White Gold checks all the boxes. Mining friendly jurisdiction, large land package, world renowned team, powerful strategic partners, has highly prospective assets with an exciting exploration pipeline, employs cutting edge technology, and generates new ideas. White Gold’s systematic and proprietary exploration strategy has recently resulted in multiple high-grade gold discoveries, including Vertigo (11.64 g/t over 5.34m), Ryan’s Surprise (20.64 g/t over 6.09m), GS West (2.97 g/t Au over 10.0m), Titan (72.81 g/t over 6.09m), and Betty (1.08 g/t Au over 50.29m).”
Eight Capital values WGO at $2.65 per share, estimating the potential for multiples of share price growth; a positive belief in the company to be sure.
The report continues on to assess each aspect of WGO backing this valuation, and using quite conservative and realistic assumptions in that valuation. The report also provides in strong detail WGO’s history, data-driven and systematic exploration strategy, and, perhaps most importantly, the company’s endgame strategy. The report reads:
“White Gold also has an endgame strategy. Management’s expertise is exploration – not project development. It doesn’t want to spend too much on delineation drilling for project development funding and dilute shareholders. Past experience with Kaminak that was sold to Goldcorp for $520 MM saw that company spend $165 MM on exploration on the Coffee deposit. Management would prefer not to take that same road and spend so much cash on one small area. The goal would be to spin the project out to both investors and technical teams that prefer more advanced stage projects, perhaps taking cash to finance ongoing exploration in a non-dilutive way. For example, Shawn Ryan’s previous Underworld venture only spent $25 MM over two years on exploration and was bought out by Kinross for $140 MM.”
Essentially, WGO has positioned itself as a district-scale project generator with half a dozen highly prospective projects at various stages of development at any given time. With strong strategic partners Agnico Eagle and Kinross Gold each owning 17.99% each of WGO, as well as Newmont Goldcorp at the adjacent Coffee property, Eight Capital sees virtue in the exploration/project generation model, but even “surmises” that the company could have potential to be an acquisition target as well.
That being said, Eight Capital’s initial coverage report is immensely useful as it manages to assemble and summarize the large quantity of information WGO has generated in the last few years. Understanding and valuing WGO’s many mineral assets, targets and prospects could appear to be complex for some, hence the huge value in a deep but understandable analysis from investment professionals such as Eight Capital team. No junior mining investor should pass on examining the large value and likely continued bright future of White Gold Corp.