FTSE Russell released the final reconstitution of the Russell 3000 and Russell Microcap indices on June 25. Perpetua Resources, headquartered in Boise, was added to both indices. The inclusion into the Russell 3000 was not too much of a surprise given that Perpetua announced its inclusion in the Russell 2000 Index on June 7, and stocks in that index are automatically listed in the 3000.
“We are pleased to have earned our inclusion in the Russell 2000 Index, one of the most widely cited performance benchmarks for emerging U.S. companies,” said Laurel Sayer, president and CEO of Perpetua Resources, in a statement. “This is an important milestone for Perpetua Resources after listing on the Nasdaq earlier this year, increasing our exposure to a broader investment community as we progress our vision to be the only mined source of the critical mineral antimony in the U.S. and restore an abandoned brownfield site through the redevelopment of our low-cost gold project.”
The inclusion in Russell indices is a large step forward for any publicly traded company but it is more so for any mining business. Modern mining is a high-risk capital-intense endeavor with long exploration and permit-acquisition lead times.
Inclusion in any well-known index is an achievement for any business — so much so that a new listing in the Russell 2000 is usually marked by an increase in stock price, and vice versa. After the June 7 announcement of Perpetua’s inclusion, its stock gained 6.8% over the next week and has since leveled off at approximately 4% of its June 7 price.
The Russell indices are published by FTSE Russell, a subsidiary of the London Stock Exchange, one of the world’s top-10 exchanges. Though it does not have the dinner-table recognition of the Dow Jones, the S&P 500 or the Nasdaq Composite, the Russell 2000 is the best-known benchmark of small cap stocks for the United States and is widely used by mutual funds.
The Russell 3000 Index encompasses the 3,000 largest U.S.-traded stocks by market-capitalization rankings. The Russell Microcap consist of the smallest 1,000 securities in the small-cap Russell 2000 Index, plus the next 1,000 smallest eligible securities by market cap, to measure the performance of the smallest publicly-traded companies. Membership in the Russell indices is updated annually. The yearly evaluation of index companies begins in May. The initial reconstitution of the indices is traditionally announced the first week in June with updates added during the month. The index inclusions are usually finalized in the last week of June.
Perpetua Resources is a mining firm focused on gold and antimony resources in the now-inactive Stibnite-Yellow Pine mining district in Valley County. It is in the permitting and design phases of reopening the mining property. The firm has contracted a goodwill agreement with the U.S. Environmental Protection Agency to remediate certain impacted surface waters and tailings left behind by historic mining operations regardless of whether the firm is awarded permits to mine. The Stibnite mineralization is the largest deposit of antimony in the United States. Antimony is a federally-designated critical material for its use in the national defense and commerce.
According to Bloomberg, Perpetua Resources (Nasdaq: PPTA) has a market cap of $442.51 million as of June 25.
(Disclosure: the author of this article owns Perpetua Resources stock.)