It has come to my attention that Desjardis Securities said this about ADV earlier this week:
Alderon Iron Ore Corp. (ADV C$1.12, TSX)
Rating Buy–Speculative Target C$2.75
Alderon takes another step forward — Jackie Przybylowski, P.Eng.
Impact: Positive
Alderon Iron Ore Corp. reported this morning that it has signed an EPCM contract with WorleyParsons Canada Services Ltd. for the development of the Kami project. The budget for the EPCM agreement is estimated at C$92.5m, consistent with the cost estimate in Alderon’s January 2013 feasibility study. In our view, the announcement is confirmation that the Kami project is moving ahead toward development—a positive for Alderon, which holds a 75% stake in the project.
Expect further incremental positive announcements. We maintain our Buy–Speculative rating and C$2.75/share target price at this time. Alderon remains our top pick among the iron ore-focused equities in our coverage universe. As the company moves toward construction start (expected 4Q13), we expect continued incremental positive announcements and minimal execution risk this year.
Upcoming expected announcements include:
– Signing a second offtake partner/strategic investor to acquire an equity stake at the company and/or project level, expected mid-year 2013
– Construction camp installation, expected summer 2013
– Receipt of major construction permits, expected by 3Q13