Vancouver, British Columbia, October 11, 2012 - Investment firm Mackie Research has updated its coverage on Scorpio Mining Corporation (TSX:SPM). Analyst Barry Allan reiterated his buy recommendation and maintained his $2.40 target price, following the release of an updated mineral resource for the company's San Rafael deposit in Mexico. This would give investors a projected return of 102% from the $1.19 price on October 2nd, the date the report was issued.
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Scorpio Mining is a Canadian-based explorer, developer and producer. The company's assets consist of the advanced-stage Nuestra Senoro silver-copper-zinc mine in Mexico, and the undeveloped San Rafael deposits.
The updated mineral resource highlighted a 26.5% increase in tonnage in the indicated category, and a 511% increase in tonnage in the inferred category.
The company also released an updated resource on its El Cajon project in the previous week, highlighting a 12% increase in overall resource tonnage, a ~ 23% increase in contained silver ounces, and an 18% increase in contained copper.
The Cosala district, which contains the San Rafael, El Cajon, and La Verde deposits, continues to showcase a growing resource which is expected to offset any declines in reserves/resources at Nuestra Senora.
Barry Allan stated "Given the current share price, Scorpio continues to offer good value through exploration in the Cosala district, which we remind readers, is located approximately 10 kilometres Northwest of the Nuestra Senora mine, and within trucking distance of the Nuestra Senora processing facility."
He cautions that as grade variability at Nuestra Senora continues to impact production, an updated reserve estimate expected in the 4th quarter of 2012 should help with mine planning, as well as provide Scorpio with a better understanding of the deposit.
Scorpio currently trades at $1.11, well below the $2.40 target price, and with 199 million shares outstanding, the company is capitalized at $221 million.
For more information, please visit the company's website www.scorpiomining.com (http://www.scorpiomining.com/) or contact Victoria Vargas at 416-585-2200 or email vvargas@scorpiomining.com (mailto:vvargas@scorpiomining.com)..
For more information about Mackie Research or to obtain the full report on Scorpio Mining, contact your nearest Mackie Research office. Their branches are listed on their website at www.mackieresearch.com (http://www.mackieresearch.com/).
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