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Strategies & Market Trends : Dino's Bar & Grill

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To: Goose94 who wrote (11535)	2/10/2016 7:56:34 AM
From: Goose94	Read Replies (1) of 203566

Tahoe Resources (THO-T) following news of its proposed all-share purchase of Lake Shore Gold, Raymond James analyst Chris Thompson hiked his rating for Tahoe Resources to "strong buy" from "outperform." Mr. Thompson continues to target Tahoe shares at $15.25. Analysts on average target the shares at $15.93. Under the agreement, Tahoe will issue 0.1467 of its stock for each Lake Shore share in a deal worth $884-million, based on a Feb. 8 closing price of $10.91. Mr. Thompson notes his net asset value (NAV) estimate for LSG's asset base is $888-million. Mr. Thompson says: "The deal value [prices] LSG's assets at 1.2-times NAV (or one-times NAV for all assets including non-production ounces), a fair price compared with peers (junior/intermediate producers currently trading at 1.1-times NAV). As such, we see interloper risk as being intermediate sector specific and limited." He adds: "For THO shareholders, our view of the transaction is constructive (adding North American production), albeit a tad expensive (valuation neutral). Upside for shareholders is offered by growth from both companies.

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