International Tower Hill Mines Ltd

International Tower Hill Mines Ltd (TSX: ITH) is a Canadian mining company, which is engaged in the acquisition, exploration, and development of mining assets. The group holds interests in an advanced stage exploration project namely Livengood Gold project, which is located ~70 miles northwest of Fairbanks, Alaska in the Tolovana mining district within the Tintina gold belt. 

Key Positives:

• During December 1, trading session, its shares crossover the short-term crucial support level of 50-day SMA and manage to close above its 50-day SMA for the two consecutive trading session, which is a positive technical indicator. Moreover, its shares are hovering well above the crucial long-term support level of 200-day SMA, implies a bullish trend in the stock.

Technical Price Chart. Source: Refinitiv (Thomson Reuters)

• Recently, the company reported the closing of USD 10.3 million public atm offering with B. Riley Securities, Inc. The proceeds would be utilized for working capital and general corporate purposes.

Q3FY20 Financial Highlights:

• ITH announced its quarterly results, wherein the company posted an increase in the total operating expenses to USD 1.187 million, as compared to USD 0.992 million in the previous corresponding period (pcp). The increase was driven by higher expense for mineral property exploration (USD 0.718 million, against USD 0.179 million in Q3FY19) and higher professional fees, partially offset by lower consulting fees and wages and benefits.
• Net loss for the period increased to USD 1.10 million, from USD 0.858 million in Q3FY19.
• Cash and cash equivalent stood at USD 13.768 million, while total assets stood at USD 69.316 million.

Source: Company Filing

Risks: The company is in the exploration stage. Any delay in the expected project timeline would dent the prospect.

Stock Recommendation:  Despite a stellar performance of its shares over the past 1-year, and given the recent technical breakout on the daily price, we still remain cautious on the stock’s future performance, as the Company has no revenue generating operations from which it can internally generate funds. The Company will require significant additional financing to continue its operations (including general and administrative expenses) in connection with advancing activities at the Livengood Gold Project and the development of any mine that may be determined to be built at the Livengood Gold Project. Therefore, we recommend a “Watch” stance on the stock at the closing price of CAD 1.93 on December 02, 2020.

1-Year ITH Daily Price Chart (as on December 02, 2020). (Source: Refinitiv, Thomson Reuters)

Disclaimer

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