Seeking Alpha
Profile| Send Message| ()  

With Jaguar Mining Inc. (JAG) continuing to show gradual quarterly increases in production, it’s not surprising that investors are responding with increases in the Brazil-focused gold miner’s share price.

Blackmont Capital analyst Richard Gray expects the mill expansion at Turmalina and increased grades at Paciencia in the second half of 2009 will continue this trend.

He estimates production of 45,000 ounces in the third quarter, 47,000 in Q4 and 240,000 in 2010 due to a contribution from Caete, which is currently under construction. Mr. Gray said the company is fully-funded to complete this growth as long as gold remains above $825 per ounce.

After increasing his target multiples, the analyst boosted his share price outlook for Jaguar to C$14 from C$12.

It continues to be his top pick in the junior gold group as a result of its peer-leading growth profile (+400,000 oz by 2012 and the potential for 640,000 oz by 2014), attractive valuation, and takeover possibility given the low political risk of operating in Brazil.

Source: Jaguar Mining Top Pick of Junior Golds - Blackmont