Rubicon Minerals (RBY) Seen as Takeover Target at TD Securities

TD Securities maintained a Spec. Buy rating on Rubicon Minerals (NYSE: RBY) and reduced its price target to C$1.35 from C$1.75. Earlier Rubicon Minerals said its CEO Mike Lalonde left the company. It also announced it has temporarily suspended its milling operations by order of the Ministry of Environment and Climate Change (MOECC). Underground development, construction and trial stoping are unaffected.

Commenting on developments, analyst Daniel Earle said, "These issues were disclosed against the backdrop of what we view as a somewhat weak balance sheet. We previously modelled the company raising additional equity; we have now increased that to an assumed $40mm (from $20mm) in an effort to be conservative."

The analyst added, "Notwithstanding recent issues, Rubicon is close to commercial production at a high grade gold project in a premier mining jurisdiction. Risks remain, including to the balance sheet, but these are amply discounted in the stock, in our view, and we would suggest at its current valuation the company may represent a takeover target."

For an analyst ratings summary and ratings history on Rubicon Minerals click here. For more ratings news on Rubicon Minerals click here.

Shares of Rubicon Minerals closed at $0.76 yesterday.

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