Despite difficult sharemarket conditions, there are a number of short-term positive catalysts, which should lift AZH towards 60c + by Christmas. Over time, AZH has the markings of a $2+stock.
Consider the following:
1. A large number of Canadian and Australian brokers (CIBC, TD Securities, Stifel, Macquarie, Dundee, Bell Potter, etc) are due to initiate research coverage within the next several months. To date, AZH has been covered by only a handful of small brokers (Blackswan, Argonaut). The point is that AZH is yet to go mainstream.
2. An investor site visit to Guyana is scheduled for Oct. 24. This is likely to generate favourable buzz with investors focusing on the significant land package that AZH holds. We might see some big volumes post this visit.
2. A rig is currently on site at Kaburi- the largest artisanal pit in Guyana. Assay results are 6wks away. Kaburi could deliver significant upside.
3. The aeromag is currently underway. This will focus on initial drill targets in East Omai, which has much the same geology as Hicks/Smarts/Kaburi.
4. It is likely that a maiden JORC of 1m-1.5m oz (likely closer to 1.5m oz, IMO) will be declared by December.
Stepping back, what is staggering is that only 0.3% of AZH's land holdings have been explored- i.e management is yet to scratch the surface- yet we can look forward to a 1m-1.5m oz maiden JORC. Truly amazing!
One outcome of the above is that (IMO) once the maiden JORC resource is declared, a major is likely to make a move on AZH. Fortunately, management and friendlies have a big enough % of issued capital to repel a bid. Notwithstanding, it wouldn't come as a surprise.
AZH Price at posting:
42.0¢ Sentiment: Buy Disclosure: Held
