IAU: Nevada High-Grade Underground Projects Will Drive Future Upside Potential

Analysts trimmed their price target on i-80 Gold to C$3.25 from C$3.50, citing a modestly higher discount rate and slightly richer future valuation assumptions, while maintaining a favorable long term outlook.

Analyst Commentary

Analysts characterized the price target adjustment as a calibration to updated models rather than a shift in the investment thesis, with the Speculative Buy recommendation underscoring expectations for meaningful upside if execution milestones are met.

Bullish Takeaways

• Bullish analysts view the maintained Speculative Buy stance as evidence that long term growth drivers, including resource expansion and project de risking, still support upside from current levels.
• The modest reduction in target price is framed as a function of higher discount rates and refined forecasts, not a deterioration in underlying asset quality or long term earnings potential.
• Positive sentiment remains anchored in the company’s leverage to rising gold prices and potential for improved cash flow generation as projects advance toward production.
• Some forecasts continue to bake in optionality from exploration success, which could justify richer valuation multiples if execution on the development pipeline is delivered on time and on budget.

Bearish Takeaways

• Bearish analysts highlight that even a modest target cut signals increased sensitivity to funding risk and execution slippage across the development portfolio.
• Higher discount rate assumptions reflect concerns around cost inflation, permitting timelines, and the time required to convert resources into sustainable, profitable production.
• Cautious views center on the speculative nature of the story, noting that valuation still embeds a premium for successful project delivery that may not materialize if timelines are pushed out.
• There is also wariness that broader market volatility in junior mining equities could cap near term multiple expansion, even if operational progress remains on track.

What's in the News

• Released a new NI 43-101 compliant mineral resource update for the non core FAD Project in Nevada, confirming high grade gold, silver, lead and zinc mineralization immediately south of the Ruby Hill Property (Key Developments).
• Highlighted historical and recent drilling at FAD, including roughly 11,000 meters completed by Paycore and about 10,000 meters by i-80 Gold in 2023, which have expanded the deposit and demonstrated strong oxide gold potential at surface targets such as Gold Hill (Key Developments).
• Reported initial high grade assay results from the Granite Creek Underground Project and provided an update on infill drilling at the Cove Underground Project in Nevada, both reinforcing resource conversion potential across the company’s underground portfolio (Key Developments).
• Confirmed that drilling at Granite Creek’s South Pacific Zone continues to return robust grades, including intercepts such as 33.6 g/t gold over 2.9 meters and 29.7 g/t gold over 3.6 meters, which supports plans for a feasibility study in the first quarter of 2026 (Key Developments).

Valuation Changes

• Fair Value Estimate: unchanged at approximately CA$2.56 per share, indicating no material shift in the modeled intrinsic value.
• Discount Rate: risen slightly from about 7.96 percent to roughly 7.98 percent, reflecting a modestly higher risk and return assumption.
• Revenue Growth: effectively unchanged at around 68.1 percent, suggesting stable expectations for top line expansion.
• Net Profit Margin: essentially flat at approximately 23.8 percent, indicating no meaningful revision to long term profitability assumptions.
• Future P/E: increased slightly from about 21.0x to roughly 21.3x, signaling a marginally richer multiple applied to forward earnings.