Assessing Blackrock Silver (TSXV:BRC) Valuation After Its Planned CA$15 Million Private Placement Financing

Blackrock Silver (TSXV:BRC) is back in focus after announcing a non brokered private placement of up to 13,636,363 units at CA$1.10 each, for potential gross proceeds approaching CA$15 million.

See our latest analysis for Blackrock Silver.

The planned financing lands after a powerful run in the shares, with a 30 day share price return of 71.08% and a 90 day share price return of 82.05%. The 1 year total shareholder return of 264.10% points to strong momentum rather than a short lived spike.

If this kind of funding driven move has your attention, it could be a useful moment to broaden your search and check out fast growing stocks with high insider ownership.

With Blackrock Silver now trading above its planned CA$1.10 financing price and coming off a very strong 1 year return, you have to ask: is there still value on the table here, or is the market already pricing in future growth?

Price-to-Book of 33.7x: Is it justified?

On the latest figures, Blackrock Silver is trading on a P/B of 33.7x, which sits well above both its immediate peers and the wider Canadian Metals and Mining industry.

P/B compares the market value of the company to the accounting value of its net assets. It is a common yardstick for early stage resource names that have little or no revenue but hold exploration properties on their balance sheets.

Here, the 33.7x P/B ratio stands in sharp contrast to the Canadian Metals and Mining industry average of 3x and a peer group average of 9.5x. This represents a very large premium and indicates that investors are assigning a much higher value to Blackrock Silver’s assets and potential than the sector and peer benchmarks currently reflect.

See what the numbers say about this price — find out in our valuation breakdown.

Result: Price-to-book of 33.7x (OVERVALUED)

However, you also have to weigh exploration risk at Tonopah West, as well as the fact that Blackrock Silver currently reports no revenue and a net loss of CA$23.38 million.

Find out about the key risks to this Blackrock Silver narrative.

Build Your Own Blackrock Silver Narrative

If you look at this and think the story plays out differently, or simply prefer to trust your own work, you can build a custom view of Blackrock Silver in just a few minutes, starting with Do it your way.

A great starting point for your Blackrock Silver research is our analysis highlighting 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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