Saracen Valuation Analysis 24th September 2020

Hi everyone,

Saracen stocks arecurrently $5.04 as at the close of 22^nd September, implying a marketcapitalisation of $5.56 billion and an enterprise value of almost $5.5 billion.Taking into account the company’s hedging schedule, we expect thatthe company’s profit margin in 2021 will be $1 200-$1 300/oz gold sold. The company’s EV/AISC-AdjustedProduction based on the 2021 guidance is $11 971/oz, EV/Resources $316/oz andEV/Reserves $647/oz, implying that it is somewhat undervalued. Given thecompany’s strong track record of delivering their guidance, even afterupgrading it and also their high-quality mines, we believe that the company’sEV/AISC-Adjusted Production to Operating Margin multiple would reasonably bebetween 9-13, implying a fair valuation range of $11 000-$15 000 for theEV/AISC-Adjusted Production. This implies a stock price range of $4.32-$6.74.

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All the best with your investing,
Brian