Aeon Metals Limited (AML) Consistent results reinforce...

Aeon Metals Limited
(AML)
Consistent results reinforce exploration upside
Recommendation
Buy
(unchanged)
Price
$0.235
Valuation
$0.34
(previously $0.27)
Risk
Speculative
Analyst
David Coates 612 8224 2887
Authorisation
Peter Arden 613 9235 1833
GICS Sector
Materials
Expected Return
Capital growth
44.6%
Dividend yield
0.0%
Total expected return
44.6%
Company Data & Ratios
Enterprise value
$129.4
Market cap
$100.1m
Issued capital
400.4m
Free float
79%
Avg. daily v
al. (52wk)
$51,40031
12 month price range
$0.13-$0.27

Drilling strike rate maintained
AML has released further assays from its Phase II di
amond drilling program at its
100%-owned Walford Creek copper-cobalt-zinc project
. They are from hole WFDD265,
drilled 200m to the west of the previously released
hole WFDD264 and returned:
38m @ 1.07% Cu, 0.15% Co
and 26g/t Ag from 226m; including
20m @ 1.41% Cu, 0.16% Co
and 25g/t Ag from 244m.
In addition to this we also note the release of dri
ll core photos from hole WFDD270,
drilled 900m to the west of the Vardy Resource. Cons
istent with previous holes drilled
in this program, it confirms visual logging of the
mineralisation.
Confidence in deposit continues to build
By our measure hole WFDD265 is by some margin the
widest intersection returned
grading above 1.00% Cu
in the last 18 months of drilling into the Vardy Zo
ne and is
wider than the previously interpreted PY3 dimensions
– implying this will be accretive
to the current Resource tonnage. At 1.07% Cu it is m
arginally lower than the current
Vardy Resource of 1.25% Cu, though the inclusive int
ersection of
20m at 1.41% Cu
and 0.16% Co
demonstrates high grades continue. This is also co
nsistent with the
modelling of high grades in the lower portion of th
e PY3 unit. Adding to this are the
previously drilled intersections of
14m at 2.23% Cu and 0.16% Co
(WFPD185, 50m to
the west) and
20m at 1.13% Cu and 0.22% Co
(WFPD184, 200m to the west).
Investment thesis – Buy, (Speculative), valuation $
0.34/sh
AML has entered an exciting period of discovery and
growth, during which effective,
cost efficient drilling could create significant va
lue through exploration success. The
latest results give us the confidence to increase o
ur exploration valuation from $70m to
$100m – in part based on peer valuations in the mar
ket - lifting our valuation to
$0.34/sh from $0.27/sh. We retain our Buy