Drill results from the Original Pit Zone (OPZ). Allegiant released results from its 9-hole drill program, representing 3,673 meters of drilling, at the Original Pit Zone at its Eastside project in Nevada. Strong gold intercepts were reported for Holes 239, 243, 244 and 245. Mineralization was encountered in 7 of the 9 holes. Hole 243, a 100-meter step-out from the closest hole in the OPZ, included 2.55 grams of gold per tonne over 147.8 meters and 3.17 grams of gold per tonne over 117.3 meters. Hole 239 included 111.3 meters of 1.45 grams of gold per tonne, including 3.1 meters of 39 grams of gold per tonne at the bottom of the hole.More drilling at the OPZ may be warranted. While the Eastside project is generally conceptualized as a low-grade, bulk tonnage open pit mining scenario, the impressive grades may signal a game-changer for project economics. While there are significant opportunities to continue to develop the original pit zone by expanding the permitted area, recent results indicate more drilling may be warranted within the permitted area. Allegiant has already announced plans to fund a 5,000-meter drilling program in the East Pediment Zone once permitting is received.Upcoming catalysts. We expect the company to provide updates shortly on the timing of an updated mineral resource estimate that incorporates drilling results for the Original Pit and Castle zones. Recall that Eastside currently has a NI 43-101 compliant inferred resource of 996 thousand gold ounces and 7.8 million silver ounces, or 1.1 million ounces of gold equivalent, with significant expansion potential. In light of the recent drill results, we think management may also be giving some thought to the drilling plan for the remainder of the year. Rating is Outperform. In our view, Eastside represents significant upside potential for investors as the company expands the resource base and proves its economics. While our valuation is based on expanding the Eastside resource base to two million gold ounces, we think that the longer-term mineral resource potential could be higher based on future drilling plans and recent drill results. Read More >>