- Torex Gold released its updated Reserves & Resource statement last week, reporting a sharp decline in El Limon Guajes reserves relative to FY2019 levels.
- This decrease in reserves occurred despite an increase in the company's average realized gold price to $1,400/oz, which is one of the higher metals prices assumptions in the industry.
- However, at a valuation of barely 6x FY2020 free cash flow, I believe most of this decline in reserves is priced in.
- At current levels, I see Torex as a Hold, but I would view any pullbacks below US$12.40 as low-risk buying opportunities.
For further details see:
Torex Gold: Digging Into The FY2020 Reserve Update