sph -rbc capital markets initiate coverage

RBC Capital Markets are Initiating coverage of Sphere Minerals "Outstanding iron ore development prospect" with a $2.85 price target and a rating of Outperform, Speculative Risk.

The 30 page RBC report covers several different scenarios which serve to underline how under-valued the stock is at present:

"Value NAV $5.68, Share Price Target $2.85: Our NAV of $5.68 includes only the Askaf and Guelb el Aouj projects. Our share price target conservatively adjusts our NAV for a range of factors including a placement, asset-level sell downs and country/development risk factors..."


"...Sphere represents an extremely attractive iron ore development opportunity. It has a large, high-quality resource base, infrastructure is in place, metallurgy is proven and there is material exploration upside. The stock is trading at a substantial discount to magnetite development peers and a 79% discount to our NAV. At the current share price, the market is factoring in very little chance of the assets being developed. We are confident the assets will be developed, and we see an initial catalyst occurring in the near term with a development partner buying in. At that point we expect a material re-rating for the stock..."