A TD research note, published this morning, upgrades NDM from Hold to Speculative Buy, and increases the target from $5.00 to $18.75.

Here is a short excerpt:

"Northern Dynasty announced that the Pebble Limited Partnership (Northern Dynasty 50%; Anglo American 50%) has approved a US$59 million budget to advance the Pebble project in Alaska.

The budget is earmarked to complete a pre-feasibility study on the project in 2009, and prepare the project for permitting to begin in 2010. The budget may be increased to US$70 million under certain conditions.

We believe Pebble is one of the largest and economically viable copper-gold projects in the world in which a junior company has a significant interest. We are increasing our target price to C$18.75 from C$5.00, and increasing our rating to Speculative BUY from HOLD on our increasing conviction that Northern Dynasty could be taken over within the next 12 months by either a copper company or a gold company."

TD summarizes their 3-page report this way:

"We believe that Northern Dynasty offers compelling long-term value and attractive exposure to copper, gold and molybdenum in a large, long-life deposit having a high probability of being developed. Our conviction has strengthened that the company represents a takeover candidate by a larger copper or gold producer. Despite the current malaise in the market for speculative investments in development mining companies, we have dramatically increased our target price to C$18.75 (previously C$5.00) and increased our rating to Speculative BUY (previously HOLD). Our total cost analysis in Exhibit 2 below demonstrates that an acquirer could pay-up for Northern Dynasty and still claim a low cost acquisition on a total cost basis per recoverable pound of copper when compared to some recent transactions."