Paramount Gold and Silver Corp. (AMEX, TSX: PZG) is an aggressive exploration company operating in the prolific and historic Sierra Madre silver-gold belt near Chihuahua, Mexico. The Company has established a 35.8 million silver equivalent resource and is currently about half way through a 50,000 meter drill program. Catalysts for appreciation in the next 12 months include:
• Drill results from San Miguel Zone
• Resource upgrade expected mid-2008
• Initiation of Scoping study by year-end
Paramount’s projects are well located among numerous previously operating mines and current areas of interest for modern exploration. Paramount’s projects resemble the nearby Palmarejo project that was recently acquired for $1.1 billion. We are initiating coverage of Paramount with a Buy rating and $4.00 price target.
Paramount Gold and Silver Corp. (AMEX, TSX: PZG) is aggressively exploring its extensive and well located land position near Temoris, Chihuahua, Mexico. Their projects are located in the Guazapares mining district, which has a long mining history and ample evidence of historic mines in the Sierra Madre silver-gold belt. They occupy most of the territory between Coeur d’Alene Mines Corp.’s (NYSE: CDE) Palmarejo project, hosting a 3.1 million ounce gold resource to the west, and Goldcorp Inc.’s (NYSE: GG) El Sauzal mine, with a 2.5 million ounce gold resource to the southeast (Figure 1). We believe that the combination of location, with exploration activities to date, suggests potential for substantial expansion of the current resource, leading to potential appreciation of Paramount’s stock price.
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