Legacy Minerals [ASX:LGM]
Metals & Mining
High-Grade Gold, Silver, and Copper Discoveries in NSW’s Proven Mineral-Rich Belts
We initiate coverage on Legacy Minerals (ASX: LGM) with a 12-month target price of A$0.65, representing a significant upside of 241.1% from the current share price of A$0.19. Legacy Minerals is an Australian gold, silver and copper explorer uniquely positioned across multiple tier-1 mineral belts in New South Wales. With a growing flagship through the Drake Project, offering a substantial JORC-compliant MRE resource, and multiple strategic joint ventures with majors such as Newmont, Legacy offers investors leveraged exposure to near-term development and high-impact discovery potential, all while preserving capital through funded exploration partnerships. Legacy is uniquely positioned with an extensive portfolio spanning more than 8,000km² across some of Australia’s most prospective mineral belts, including the Lachlan Fold Belt, New England Fold Belt, and the prolific Cobar Basin. The company is advancing both 100%-owned projects and a suite of strategic joint ventures.
Flagship Polymetallic MRE Resource and Tier-1 Discovery Potential Across Multiple Exploration Fronts
The Drake Project is Legacy’s most advanced asset, highlighted by a JORC 1.2Moz AuEq resource that includes 792koz AuEq and 35Moz AgEq. It benefits from A$80m in existing infrastructure, including a water supply and tailing facilities, reducing development risk and increasing ROI. With an updated pre-feasibility study (PFS) planned, Drake offers compelling near-term development potential, well-positioned to capitalise on rising gold, silver, and copper prices. Beyond Drake, Legacy’s diversified exploration portfolio unlocks district-scale discovery potential. The Thomson Project—a 5,500km² greenfield opportunity—is prospective for large-scale intrusion-related copper-gold systems, comparable in scale to major provinces like the Paterson. A discovery here would be company-making. Legacy also offers multiple strategic partnerships, including the Bauloora Joint venture (JV) with Newmont, targeting a A$15 million drill spend on one of Australia’s largest low-sulphidation epithermal systems. Additional JVs at Fontenoy (Earth AI) and Glenlogan (S2 Resources) further enhance Legacy’s exposure to potential tier-1 discoveries, all while preserving shareholder capital.
Attractive Valuation with Material Upside
We value LGM at A$0.57 per share in a base-case scenario and A$0.72 pershare in a bullcase scenario. The valuation approach combines discounted free cash flow (DCF) and a peer comparison. Our valuation incorporates several layers of conservative assumptions that reduce the resource size, operating margin, and resource recovery rates. Most importantly, the significant value offered by the multiple joint ventures has not been factored into this valuation, which could materially re-rate the stock following a discovery announcement. Consequently, we can confidently put forth an attractive investment thesis for LGM, with scope for further upside beyond our current forecast.