02:28 PM EDT, 09/15/2025 (MT Newswires) -- (Updates with shares and National Bank commentary)

Discovery Silver ( DSVSF ) was up 1.8% and setting fresh 52 week highs Monday as it entered into an agreement with a syndicate of financial institutions for a revolving credit facility that allows it to borrow up to US$250 million, with an accordion feature for an additional $100 million, subject to certain conditions.

A statement noted the facility will mature on Sept. 15, 2028, and is available for general corporate and working capital needs, including financing future investments.

After entering into of the deal, Discovery will cancel the existing term loan agreement with Franco-Nevada GLW Holdings involving a $100 million senior debt facility, entered into as of April 15, which remained undrawn as of the date of termination.

"The Revolving Credit Facility we have arranged with the Syndicate will provide both increased financial capacity and greater flexibility as we advance our attractive growth profile in both Canada and Mexico," said Discovery Silver ( DSVSF ) chief executive officer Tony Makuch.

Meanwhile, National Bank of Canada maintained its Outperform rating and Target of C$4.75 on Discovery Silver ( DSVSF ) and said it believes that the new bank debt facility provides additional liquidity and flexibility for the company to fund ongoing integration work, and it bears a lower cost than the now eliminated FNV term loan.

The bank believes that the "increased liquidity buffer opens up the possibility of pursuing more significant capex for expansions beyond what was considered in the PEA study, possibly including a restart of the Dome mine." It said the company may also consider exercising its right to buy back the 2% net smelter return from Franco-Nevada ( FNV ), at a cost of a National Bank forecast of US$98 million.

"We may also see accretive M&A deals to consolidate spare milling and TSF capacity in the region," said analyst Rabi Nizami.

National Bank estimates the company to be net positive free cash flow for the remainder of 2025 and 2026 owing to "buoyant gold prices as capex and exploration spending are expected to accelerate."

"Our Outperform rating considers the embedded potential of the Porcupine project to deliver significant free cash flows to fund growth and expansion opportunities across the portfolio, said Nizami. "Our target price is based on 7.0x EV/EBITDA 2026 (50%) and 0.85x P/NAV (50%), which is comparable to Intermediate peers in our coverage and balances near-term performance with the medium-term growth trajectory and optionality on the Cordero project."

Shares of the company were last seen up 1.8% at $5.05 on the Toronto Stock Exchange.

(MT Newswires covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://www.mtnewswires.com/contact-us)

Price: 5.06, Change: +0.10, Percent Change: +2.02