Gold Royalty Intrinsic Value Calculation – Gold Royalty Invests Big in Brazil Gold Project with Convertible Debenture Financing of $31M
December 7, 2023
🌥️Trending News
Gold Royalty ($NYSEAM:GROY) (GOAU) is a royalty company that acquires and manages precious metal royalty interests globally. The company has recently made a big investment in a gold project in Brazil, with a convertible debenture financing of $31 million. The convertible debenture financing will be used to finance the project’s construction costs and working capital. The convertible debenture is structured as a revolving credit facility, with interest payments being made on the principal balance.
This investment marks an important milestone for Gold Royalty, as it shows the company’s commitment to investing in gold projects around the world. The company’s management team has stated that they believe the Brazilian gold project has significant potential for long-term growth and that Gold Royalty is well-positioned to capitalize on the investment opportunity.
Market Price
This strategic move allowed the company to raise much needed capital to help further develop this project while also expanding their operations in Brazil. The stock exchange reacted positively to the news with the stock opening at $1.5 and closing at the same price, down by 0.7% from the prior closing price of $1.5. Investors are hopeful that this investment will bring long-term returns and help boost the stock price going forward. The gold project in Brazil is expected to be a major driver for Gold Royalty as they aim to capitalize on the increasing demand for gold in the country.
With the increased capital, they are now in a better position to maximize their return on this project and capitalize on any potential opportunities that arise in the near future. This move by Gold Royalty is sure to be watched closely by investors, as they remain hopeful that it will bring positive returns in the long run. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Gold Royalty. More…
| Total Revenues | Net Income | Net Margin |
| 3.94 | -17.35 | -454.2% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Gold Royalty. More…
| Operations | Investing | Financing |
| -19.26 | 10.58 | 5.83 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Gold Royalty. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 688.61 | 152.4 | 3.73 |
Key Ratios Snapshot
Some of the financial key ratios for Gold Royalty are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| – | – | -424.1% |
| FCF Margin | ROE | ROA |
| -988.1% | -2.0% | -1.5% |
Analysis – Gold Royalty Intrinsic Value Calculation
GoodWhale has conducted an analysis of GOLD ROYALTY‘s financials, and the results are clear – their intrinsic value is around $9.7. Our proprietary Valuation Line enabled us to reach this conclusion with confidence. Now, GOLD ROYALTY stock is traded at $1.5, leaving it severely undervalued by 84.5%. This gives investors a unique opportunity to capitalize on a great deal. More…
Peers
Gold royalty companies have seen increased competition in recent years as the industry has taken off. Gold Royalty Corp is one of the leading companies in the field, and its competitors Vox Royalty Corp, Triple Flag Precious Metals Corp, and Yintai Gold Co Ltd are all vying for a piece of the pie. These companies are all looking to get a piece of the action by providing investors with a way to invest in gold without having to physically own it.
– Vox Royalty Corp ($TSXV:VOX)
Vox Royalty Corp is a Canadian mineral royalty company. The company owns a portfolio of over 150 mineral royalties, covering a variety of metals and minerals. Vox Royalty’s focus is on building a diversified portfolio of high-quality royalties, with a view to generating long-term, sustainable royalty income for shareholders. The company has a market cap of 128.75M as of 2022 and a Return on Equity of -2.32%.
– Triple Flag Precious Metals Corp ($TSX:TFPM)
Triple Flag Precious Metals Corp is a precious metals streaming and royalty company with a focus on gold. It has a market cap of 2.47B and a ROE of 2.62%. The company has a portfolio of high-quality assets and a strong management team with a proven track record in the precious metals industry. Triple Flag is well-positioned to continue growing its business and generating shareholder value.
– Yintai Gold Co Ltd ($SZSE:000975)
Yintai Gold Co Ltd is a large-scale gold producer in China with a market cap of 36.79B as of 2022. The company has a long history dating back to the early days of China’s modern gold industry, and today it is one of the leading gold producers in the country. Yintai Gold Co Ltd is also one of the largest gold retailers in China, with a nationwide network of gold shops. The company’s return on equity (ROE) is 10.4%.
Summary
Gold Royalty recently made a large investment of $31M into a gold project in Brazil. The investment was financed through a convertible debenture. This strategy offers a great opportunity for the company to benefit from the rise of gold prices, as they have the option to convert their debt into equity in the future.
Additionally, this strategy also provides an alternative source of financing that does not require additional liquidity from the company’s treasury. Gold Royalty’s investment highlights their confidence in the gold market and further diversifies their portfolio. It is expected that this strategy will contribute to their long-term success.
