Dolly Varden Silver Corp. (DV:TSX.V; DOLLF:OTCQX) encountered more bonanza gold grades while drilling the Homestake Silver deposit at its Kitsault Valley project in northwestern British Columbia, reported Research Capital Corp. analyst Stuart McDougall in a Nov. 4 research note.
These results "bolster [the] potential for bonanza grades and bulk mining potential," McDougall wrote.
15% uplift implied
McDougall reiterated Research Capital's target price of CA$1.45 per share on the Canadian explorer.
"Our target price still reflects an assumed 25% increase in both metals for that and the project's six other zones, valued at US$3 per ounce (US$3/oz) and US$75/oz, respectively, adjusted for options," the analyst explained.
Dolly Varden Silver's current share price is about CA$1.26. The difference between the current and target prices suggests a 15% return.
The company remains a Speculative Buy.
Takeaways from results
McDougall discussed the new drill results. Dolly Varden Silver reported the results of five holes, and three of them showed grades higher than the resource averages. Hole HR24-432, for example, returned "a spectacular" 701 grams per ton gold (701 g/t Au) and 184 g/t silver (Ag) over 0.54 meters (0.54m). This hole, collared 65m along strike of hole HR24-435, also showed 13.94m averaging 29.24 g/t Au and 16 g/t Ag.
Another intercept, from hole HR-435, collared in the deposit's central area, confirmed the potential for tonnage in the higher-grade core. It demonstrated 34.93m averaging 12.23 g/t Au and 84 g/t Ag, including three higher-grading subintervals. These were 74.15 g/t Au and 376 g/t Ag over 2.43m, 34.98 g/t Au and 75 g/t Ag over 2.43m, and 54.4 g/t Au and 346 g/t Ag (plus 17.28% lead and zinc) over 1m.
Other highlight results included:
- 0.7m of 12.64 g/t Au and 10.1 g/t Ag over 0.7m, from hole HR24-445. This was followed shortly by 0.5m at 8.75 g/t Au and 28.2 g/t Ag over 0.5m, which undercut hole HR24-435 by about 250m. The enclosing halo averaged 2.18 g/t Au and 5.25 g/t Ag over 14.11m.
- 9.95m averaging 4.58 g/t Au and 6 g/t Ag, from hole HR24-442, which undercut hole HR24-432 by about 250m. The last 1.69m downhole returned grades of 14.96 g/t Au and 14 g/t Ag, "suggesting potential for expansion of the higher grades at depth," noted McDougall.
True widths were estimated at 70–85% of the core lengths.
More results to come
The technical report for Homestake Ridge, updated in March 2023, confirmed previous resources, McDougall reported. It combined and included results of two previous sets of drill programs. One set encompassed 91,000m of drilling between 2019 and 2024 in the original Dolly Varden block. The other included about 50,000m drilled between 2022 and 2024 on the northern Homestake Ridge block.
Drill results from this year are pending for 23 of the 69 holes drilled over 31,726m. These data and other project updates, expected in the near term, could boost Dolly Varden Silver's share price.
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