Fundamental Research Initiates Coverage on NxGold Ltd. with BUY Rating

Fundamental Research Corp (FRC) has initiated coverage on NxGold Ltd. (TSXV:NXN), with a BUY rating and a fair value estimate of C$0.31 per share.

As quoted in the report, FRC’s highlights for NxGold include:

• NxGold Ltd. is led by founders of NexGen Energy Ltd. (NYSE:NXE / Market capitalization of $940 million) – a high profile uranium exploration / development company focused on assets in the Athabasca Basin in Saskatchewan, Canada.
• The company holds an 80% interest in the Mt. Roe gold project in Pilbara, Western Australia, and has an option to earn up to a 70% interest in the Kuluu project in Nunavut, Canada.
• The Pilbara project is located next to Novo Resources (TSXV:NVO / Market capitalization of $537 million) and Artemis Resources’ (ASX:ARV / Market capitalization of $118 million) Karratha gold project. Discovery of multiple gold nuggets in July 2017, by Novo and Artemis prompted a gold rush in the Pilbara, making it one of the hottest areas for gold exploration.
• At its Mt. Roe project, NxGold has identified 7 km of potential strike length, and recovered several gold nuggets at surface. Some of these nuggets have similar characteristics as the ones recovered by Novo and Artemis, others are indicative of primary proximal mineralization.
• NxGold is planning to continue its systematic path of determining and defining the source of the gold found to date.
• The company is awaiting receipt of Land Use Licences to commence exploration at its Kuulu project. Due to delays in receipt of these licences, NxGold has suspended its required earn-in obligations on the property. The project is located just 20 km northwest of Agnico Eagle’s (NYSE:AEM) Meliadine Gold project, which is being advanced to production. Meliadine has proven and probable reserves of 3.7 Moz gold at an average grade of 7.12 gpt. NxGold estimates a renewal application to be submitted, with additional community support, in Q4 2018.
• NxGold is in a strong cash position, with approximately $4.30 million at the end of Q2 (June 30, 2018).
• We are initiating coverage with a BUY rating and a fair value estimate of $0.31 per share.

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