Lahontan Gold: Acquisition and PEA in Focus
The Canadian company is currently transitioning from a project developer to a gold producer. At the centre of this is the formerly producing Santa Fe Mine in the US state of Nevada. Between 1988 and 1995, approximately 359,000 ounces of gold were mined here. Of strategic importance is the recently announced merger with Emergent Metals. Through this transaction, Lahontan will become the sole owner of the West Santa Fe Project, a satellite property of the main Santa Fe property. In addition, the property area will expand to 93 km². Existing Emergent shareholders are expected to hold approximately 4.7% of the combined company. Lahontan plans to begin construction of the mine in 2027.
The updated resource estimate published in August revealed a 22% increase compared to 2024. 1.195 million ounces of gold equivalent are classified as “indicated,” with an additional 1.19 million classified as “inferred.” The old heap leach pads add further appeal. Material already mined there was treated with a solution to extract precious metals. New investigations are examining how much recoverable gold remains. In mid-September, Lahontan reported, among other things, 16.5 m grading 2.72 g/t gold equivalent. However, the weighted average of all samples from the first ten drill holes, which totaled 0.50 g/t, is more indicative of the area investigated so far.
The most important upcoming test will be the updated preliminary economic assessment (PEA). The previous PEA from December 2024, based on prices at that time of USD 2,705 per ounce of gold and USD 32.60 per ounce of silver, calculated a post-tax project net present value of USD 200 million. Now, with a gold price of just over USD 4,000, the new project value is likely to be about 50% higher. This contrasts with an enterprise value of about CAD 180 million, or USD 126 million.
Evotec: No Decisive Momentum Yet
Evotec supports pharmaceutical and biotech companies in drug discovery and preclinical development. Revenue is generated from services, collaborations, and project-based payments. Numerous downward revisions to forecasts have been unsettling investors for many quarters. The half-year results reveal the urgent need for action. Revenue declined by 19.2% to EUR 300.1 million during the reporting period. On an operating basis (EBITDA), the company posted a loss of EUR 42.7 million. Following the most recent forecast revision, Evotec expects full-year revenue of EUR 570 to 610 million and an adjusted EBITDA loss of EUR 70 to 105 million.
However, there are signs of a possible turning point. A look at the figures shows that order intake in the core research business, excluding strategic partnerships, rose by about 28% in the first half of the year. Evotec expects stronger revenue contributions from this segment starting in the fourth quarter. The Horizon cost-saving program is also expected to reduce the annual cost base by EUR 75 million by the end of 2027.
At the end of the third quarter, Head of Research Cord Dohrmann stepped down, keeping the personnel merry-go-round spinning. The stock has lost over 40% since the beginning of the year. Analysts do not expect the company to return to profitability until 2028. On average, experts have set a price target of EUR 4.60, giving the stock an upside potential of 55%.
Deutz: 40% Upside
Deutz supplies engines and drive systems for construction and agricultural machinery, generates revenue from maintenance and replacement parts, and is expanding its decentralized energy solutions and defence business. The agreed-upon acquisition of military vehicle supplier FFG will significantly change the company’s business profile. The announced transaction volume amounts to approximately EUR 1.6 billion, to be paid for with cash and new shares. In September, Deutz raised approximately EUR 179 million by issuing around 15.3 million new shares at a gross price of EUR 11.70. This increased the share count by 10%.
The stock has gained a good 30% since the beginning of the year. Analysts estimate the stock has upside potential of nearly 40% over the next 12 months. The P/E ratio for the current year is moderate at 15.2 and is expected to improve significantly to 9.3 by 2027. The FFG acquisition is expected to further improve the company’s financials in the future. In the first half of the year, revenue rose by 10.7% to EUR 1.12 billion. Adjusted EBIT increased by 43.1% to EUR 79.7 million.
A convincing PEA could provide a positive boost to Lahontan Gold’s stock. The roadmap leading up to the resumption of production includes additional triggers. Evotec is a bet on a recovery, but the most important evidence for this has yet to materialize. Deutz is expanding into new dimensions thanks to the FFG acquisition. Analysts are bullish.
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