AbraSilver Resource Corp. (ABRA:TSX; ABBRF:OTCQX) has announced the final drill results from its Phase 4 exploration program at the Diablos silver-gold project in Salta Province, Argentina. The company reported the identification of several high-grade silver veins in the JAC Extension zone, outside the boundaries of the currently envisioned open pit. These results are expected to be incorporated into an updated Mineral Resource Estimate anticipated in mid-2025 and will form a significant part of the ongoing Definitive Feasibility Study.
Among the key drilling highlights is hole DDH 25-002, which averaged 162 g/t silver over 65.0 meters, including a 12.0-meter section grading 405 g/t silver. Hole DDH 25-005 returned 139 g/t silver over 63.0 meters, and DDH 25-012 intersected 160 g/t silver over 41.5 meters. All reported assays reflect uncut and undiluted drilled widths, which may differ from true widths.
Dave O’Connor, Chief Geologist of AbraSilver, stated in the press release, "These latest drill results confirm the presence of strong silver grades over significant widths at shallow depths." John Miniotis, President and CEO, added, "We are very pleased with the final results of our successful Phase 4 program, which continues to demonstrate the significant growth potential beyond the current open pit boundaries."
The Phase 4 drilling program, totaling 21,172 meters, focused on expanding the mineralization in the JAC Extension zone, which remains open to the south and west. A Phase 5 drilling program is already underway, targeting several priority areas within the broader Diablos mining district. Situated in a region with established infrastructure and several adjacent mining projects, the Diablos project comprises 15 contiguous mining claims covering a significant total mineralized area. As of March 2024, the Measured and Indicated Resources stood at 42.3 million tonnes grading 91 g/t silver and 0.81 g/t gold, containing 123.5 million ounces of silver and 1.1 million ounces of gold.
Silver Sector Shows Strength Amidst Pressure, Eyes Upside Potential
Recent market analysis and commentary present a complex outlook for the silver sector in April, noting both structural constraints and signs of emerging strength. On April 23, FX Empire highlighted that silver had resumed its upward pressure, particularly around the US$33 level.
Christopher Lewis commented, "This is a bit different than what we’ve seen in the gold market, which has seen significant downward pressure," pointing to silver's dual role as both a precious and industrial metal. He noted that the movement of silver around the 50-day Exponential Moving Average (EMA) continues to attract trader attention, with sustained bullish momentum driving market sentiment.
Raymond James analyst Craig Stanley reaffirmed an "Outperform" rating on AbraSilver Resource Corp. with a target price of CA$5.00.
On April 26, Kitco News reported that Florian Grummes of Midas Touch Consulting stated that "silver is extremely undervalued" and could rally to between US$40 and US$50 in the coming months. Grummes pointed to the gold-silver ratio as a key indicator of valuation, arguing, "We have a 10 to 1 ratio on the planet, 7 to 1 in production, and yet we are trading at over 100 to 1 in the market," suggesting significant room for silver to correct its historical imbalance.
On the same day, technical analyst Clive Maund described a "pressure cooker" situation in the silver market. He pointed to a surge in short positions as a potential catalyst, writing, "This cannot persist… the widening gap between spot and futures prices is an intolerable situation." Maund suggested that a sharp reversal could occur once market forces begin to challenge the current state. He also interpreted low retail investor participation as another sign that the silver market remains in the early stages of a bull run, stating, "There is hardly any interest in this market from the retail public… the current low gold-silver ratio implies that this bull market is still in its early stages."
Analysts Maintain Bullish Outlook on AbraSilver
On April 15, 2025, Raymond James analyst Craig Stanley reiterated a "Buy" rating on AbraSilver Resource Corp., maintaining a target price of CA$5.00. The company's stock closed at US$2.28 the previous day. According to TipRanks, Stanley has a success rate of 52.43% on his stock recommendations with an average return of 9.8%, and his coverage includes companies in the Basic Materials sector. At the time, AbraSilver held a "Strong Buy" consensus rating among analysts, with an average target price of US$3.90, representing a potential upside of 71.39% from the recent closing price. Scotiabank also maintained a "Buy" rating with a target price of CA$5.50 in a report issued the same day.
On the same day, Beacon Securities analyst Michael Curran maintained a "Buy" rating on AbraSilver Resource Corp. and set a 12-month target price of CA$6.00, implying a 90% potential return. Following a recent site visit to the company’s mining operations in Argentina, Curran highlighted that the Diablos project "shows above average potential to successfully transition from explorer to producer." He noted that the project’s infrastructure requirements appear manageable and pointed to strong exploration potential in new prospective areas such as Sombra, Oculto East, and Cerro Viejo. Curran’s valuation is based on a blend of a 0.90x target Price to Net Asset Value (P/NAV) multiple and a forward Price to Cash Flow (P/CF) analysis.
According to a Scotiabank Capital report dated April 29, analyst Eric Winmill reaffirmed a "Sector Outperform" rating and a target price of CA$5.50. Winmill viewed the completion of the Phase 4 drilling at the JAC Extension as a positive development, highlighting several high-grade intercepts, including 162 g/t silver over 65.0 meters and 139 g/t silver over 63.0 meters. He stated, "We see potential for resource expansion based on drilling success in areas near planned mining and infrastructure." Scotiabank Capital also pointed out that AbraSilver’s stock is trading at a 0.23x Price to Net Asset Value (P/NAV) based on a 5% discount rate, which is well below the peer average.
National Bank Financial also issued a positive assessment on April 29. In their report, analyst Don DeMarco maintained an "Outperform" rating and increased the target price to C$5.75, noting that "impressive infill drill results over broad intervals should help de-risk the resource." He highlighted the 65m intercept grading 161.6 g/t silver in DDH-25-002 and added that the Phase 5 drilling program is underway, with mineralization open to the south and west. DeMarco concluded that the company’s investment thesis is supported by "a large silver-gold M&I resource, high-grade silver near surface at JAC, promising exploration potential, and increased M&A appeal."
Two weeks later, on April 30, Peter Krauth of Silver Stock Investor published a positive review of AbraSilver Resource Corp., citing strong exploration progress at its Diablos and La Coipita projects in Argentina. He described the recent silver results from Diablos as "high-grade and amenable to open-pit mining," emphasizing their discovery at shallow depths over wide widths outside the currently envisioned pit boundary. According to Krauth, "These are the last assays from the Phase 4 exploration campaign… and the team will incorporate them into the upcoming mid-2025 resource update."
Krauth specifically pointed to hole DDH 25-002, which returned 162 g/t silver over 65.0 meters (including 405 g/t silver over 12.0 meters), and hole DDH 25-005, which intersected 139 g/t silver over 63.0 meters. He noted that mineralization remains open to the south and west, and that Phase 5 drilling has already commenced, targeting several priority areas.
Beyond Diablos, Krauth also discussed new developments at AbraSilver’s La Coipita copper-gold-molybdenum project. He called the results from hole DDH-LC25-006 a "discovery," highlighting an average grade of 0.38% copper, 0.07 g/t gold, and 62 ppm molybdenum over a 621-meter interval. This included higher-grade sections of 0.70% copper over 114 meters and another 20-meter section at 1.03% copper. Krauth stated, "0.38% copper over the entire 621-meter interval is very significant and could have tremendous potential."
He added that further drilling is underway, which should help delineate the scale of the mineralized system. While emphasizing that it is an early-stage discovery, Krauth concluded that AbraSilver continues to offer significant growth potential. He noted, "Although ABRA shares have risen by about 26% this year, they still look undervalued given the growth potential they continue to demonstrate," suggesting that any share price weakness could present an attractive buying opportunity.
Pathways to Value Creation: Key Catalysts and Growth Drivers
As presented in investor materials, the development plan for the Diablos project is underpinned by robust project economics, a strong resource base, and a clear roadmap for growth. The December 2024 Pre-Feasibility Study outlined a Net Present Value (NPV) of US$747 million at a 5% discount rate, based on base case metal prices of US$25.50/oz silver and US$2,050/oz gold. The estimated Internal Rate of Return (IRR) is 28%, with a payback period of 2 years. The average All-In Sustaining Costs (AISC) over the life of mine are projected at US$12.67 per silver equivalent ounce, significantly below the industry average.
Ongoing work includes a fully funded 20,000-meter Phase 5 drill program targeting resource expansion in the Oculto-JAC area and evaluating the Cerro Viejo gold target, located 4 km northeast of Oculto. The first drill hole at Cerro Viejo intersected 1.91 g/t gold over 36.0 meters (including 7.22 g/t gold over 5.0 meters), and the area remains largely underexplored.
The company is also poised to benefit from Argentina’s new RIGI investment incentive regime, which offers significant tax and export duty reductions for large-scale mining projects. The Diablos project qualifies for these benefits, and the company anticipates potential cost savings of approximately US$430 million in total if the RIGI package is fully utilized.
Having doubled its Measured and Indicated Resources since 2020 and achieved a low discovery cost of US$0.11 per silver equivalent ounce, AbraSilver continues to expand the scale of the Diablos project. The company’s development timeline aligns with key upcoming milestones, including environmental permitting, resource updates, and the completion of the Definitive Feasibility Study.
Ownership Structure and Share Information
According to Stanley, AbraSilver’s major shareholders include insiders (management and board members) at 3%, Central Puerto S.A. at 9.9%, and Kinross Gold Corporation (K:TSX; KGC:NYSE) at 4%. (In AbraSilver’s recent CA$58.5 million financing, Central Puerto invested CA$25 million, and Kinross invested CA$3 million.)
AbraSilver has 152.7 million shares outstanding and a market capitalization of CA$456 million. The 52-week trading range for the stock is CA$1.33 to CA$3.58 per share.
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