Vizsla Silver (TSX:VZLA) Renews Rights Plan, Is It A Bargain Or Fairly Priced?
Board decisions and governance update at Vizsla Silver
Vizsla Silver (TSX:VZLA) just wrapped up its annual general and special meeting, where shareholders set the board at seven directors, renewed the Shareholder Rights Plan, and reappointed Deloitte LLP as auditor.
The firm also reiterated that no production decision has been taken for the Panuco Project, with any construction still contingent on detailed engineering, financing, and required permits and approvals.
Vizsla Silver’s share price has had a choppy run, with a 14.45% 90 day share price return coming after a 30 day share price decline of 10.27%. The 1 year total shareholder return is down 19.78%, while the 3 year total shareholder return is up more than 2.5 times.
Scan for other silver producers with similar governance or project milestones and see how they stack up against Vizsla Silver using our curated list of 10 top silver producer stocks.
Vizsla Silver has pulled back over the past month, yet still trades at a steep discount to published analyst targets. So where does a reasonable view of fair value actually land inside that spread?
Most Popular Narrative: 93% Undervalued
On the valuation work shared for Vizsla Silver, the most followed narrative pegs fair value at about CA$69.03 per share versus the recent CA$5.07 close. This is a wide gap for any investor to weigh against project risk and execution hurdles.
The project has the kind of numbers silver investors dream about: 17.4Moz AgEq per year, US$10.61/oz AISC, US$1.8B after-tax NPV, 111% IRR, and only a 7-month payback at Feasibility Study prices. That is rare.
The only reason this is not an easy 5-star rating is risk. The security situation in Sinaloa is serious. Workers got abducted and killed, that is not a small issue. Sinaloa is really a stronghold of cartel territory. Then, the company still needs to execute construction, receive key permits, manage underground mining risk, control costs, and bring the mine into production safely.
See why 14 investors see Vizsla Silver as 93% undervalued.
Result: Fair Value of CA$69.03 (UNDERVALUED)
Still, the Vizsla Silver story hinges on permits and on-the-ground security, and setbacks on either front could quickly puncture even the most bullish narrative.
Find out about the key risks to this Vizsla Silver narrative.
Next Steps
Big upside story or risk skewed setup. Either way, it pays to check the detail yourself before sentiment swings again and to weigh both sides through the 1 key reward and 1 important warning sign.
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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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