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Aurania Resources gets repeat Outperform rating from Noble Capital despite coronvairus market impact

The company had to suspend its operations in Ecuador due to the coronavirus, but a shift in focus and a C$6.5 million private placement make it well positioned to play the long game

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Aurania is an exploration company engaged in the identification, acquisition and exploration of mineral property interests

Aurania Resources Ltd (CVE:ARU) (OTCMKTS:AUIAF) is well set up for the future according to analysts at Noble Capital Markets, who awarded the company an Outperfrom rating this week even as the junior exploration and mining sector grapples with the impact of the coronavirus (COVID-19).

Aurania, for its part, suspended its field operation and withdrew personnel from its flagship Cordillera de Cutucu operation located in the eastern foothills of the Andes mountain range in southeastern Ecuador. 

Noble noted that Aurania’s management team has shifted focus to working through its field data backlog; planning ground surveys at its Crunchy Hill and Yawi targets in the country; and refining the drilling plan for epithermal gold and silver targets and refining sediment-hosted copper-silver targets in both Ecuador and Peru.

READ: Aurania Resources responds to coronavirus pandemic; withdraws staff in field in Ecuador

That shift sets the company up well for the future in the eyes of Noble’s analysts. What's more, because of the lower expenses, Noble narrowed its 2020 loss projection for the company from $C0.41 per share to C$0.38 per share.

“In our view, the company will be in a better position to hit the ground running once work restrictions are lifted,” Noble wrote. “Drilling results from Yawi are expected to be released shortly. Once fieldwork resumes in Ecuador, we expect Aurania to move from Yawi to drilling at Tiria.”

The firm also pointed to a recent private placement that raised nearly C$6.5 million, which makes Aurania well-funded enough to execute its exploration activities this year. 

“While the stock has sold off with other junior explorers and the broader market, we think Aurania is likely in its strongest position yet to capture the value of its exploration activities,” Noble wrote

Despite the overall optimism, Aurania was not completely immune to market forces, as Noble revised its price target for the company down from C$4 per share to C$3.25 per share. 

Shares of the company traded at C$2.08 midday Monday. 

Aurania is a mineral exploration company engaged in the identification, acquisition and exploration of mineral property interests, with a focus on precious metals and copper. The company is spearheaded by a credentialed and respected university professor and two PhD geologists with world-class discoveries in Ecuador already under their belts.  

Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com 

Follow him on Twitter @andrew_kessel

Quick facts: Aurania Resources Ltd

Price: 4.3 CAD

TSX-V:ARU
Market: TSX-V
Market Cap: $175.96 m
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