Filo Mining Jumps 13% After Highest Silver Concentration to Date

Filo Mining (TSX:FIL)(OTC:FLMMF) grew 14% in a day after the announcement of a strong future outlook for its Filo del Sol mine and analyst boosts across the board.

Amy Legate-Wolfe

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Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Her work can also be found at Canada's National Observer, where she writes on the business side of climate action. Before joining Motley Fool Canada, Amy wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband.

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Published January 12, 2022 4:30 pm EST

| More on: FLMM.FFIL

Filo Mining (TSX:FIL)(OTC:FLMMF) shares jumped 13% on Tuesday after the company announced that its Filo del Sol drilling program is far better than originally thought. Production increased, and more is on the way. This on top of analysts increasing target prices for Filo in recent days.

What happened?

The drillhole from Filo del Sole returned the “best intersection of high-grade silver on the project to date,” according to a statement from Filo Mining. The initial results weren’t just good news but beyond comprehension, according to Jamie Beck, resident and CEO of Filo Mining.

“Hole 55A is one of the longest, highest-grade silver intercepts seen globally in a long time,” Beck said. “It is a great reminder of the outstanding precious metal content of this remarkable deposit and demonstrates that we’ve got a significant silver deposit contained within the major copper-gold deposit at Filo del Sol.”

So what?

This recent news allowed the company to increase its outlook for 2022. The company continues to work year round on the Filo del Sol mine, calling it its “most ambitious field program ever.” Two drill rigs should be online by February, bringing the total drills to seven operating all year round.

And again, this comes as analysts boost their target price for Filo Mining. Last week, analysts at Pi Financial and Canaccord both boosted their target price to $17. And this occurred early this week, before the recent mining results were announced.

Now what?

So, what should Motley Fool investors do with Filo Mining right now? Shares currently trade at about $14.25, which is in line with current consensus target prices. However, in the recent months, analyst after analyst keep boosting that target price. It could be very soon that a target price of $17 reaches the company.

However, Filo Mining is also still a new company. While it’s certainly one to watch, I would also wait to see how production ramps up. The company recently reported a net loss of $9.1 million, or $0.08 per share. This was in line with expectations, but far above the $2.5 million loss the year before.

Still, that loss mainly came from exploration and project investigation costs. And should this new mine prove as fruitful as promised, the company could be back in the black in no time.

Shares of Filo Mining are up 632% in the last year and 22% in the last month.