Vancouver, British Columbia, June 25, 2013 - Investment firm PI Financial has initiated coverage on Luna Gold (TSX:LGC). Analyst Philip Ker gives the company a buy recommendation and target price of $3.35, a premium of 85% to the $1.81 price the day the report was issued.
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Luna Gold is a junior gold producer, located in northeast Brazil, with aggressive growth plans to expand operations at its flagship open pit Aurizona property. It plans to increase gold production from the 74,000 ounces in 2012 to a life of mine average of 135,000 ounces per year in 2014, at PI Financial's estimated cash costs averaging $760 per ounce.
Luna Gold recently completed an updated resource and reserve estimate that increased ore reserves to 2.36 million ounces and total resources above 4.6 million ounces. PI Financial believes this is a solid reserve base with world class potential to expand beyond 5 million ounces and with current reserves supporting a 15 year mine life.
The company recently announced the identification of additional gold targets at the company's Greenfields project, 23 kilometres southeast of the Aurizona Gold Mine.
John Blake, Luna's President and CEO stated, "We remain focused on generating new gold targets through the interpretation of Luna Greenfields' significant exploration database which we have been developing since 2009."
Analyst Philip Ker stated, "With significant growth in production levels to come and potential for substantial organic growth from its solid reserve and resource base, we believe this justifies a buy recommendation."
Luna Gold recently traded at $1.84, and with 105 million shares outstanding, the company is capitalized at $193 million. As we stated, this is well below PI Financial's target price of $3.35.
For more information please visit the company's website www.lunagold.com or contact Candice Williams at 604-568-7993 or email ir@lunagold.com (mailto:ir@lunagold.com).
For more information about PI Financial or to obtain a copy of their research report, contact your nearest PI Financial office. Their branches are listed on their website at www.pifinancialcorp.com (http://www.pifinancialcorp.com/).
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