Elemental Royalties (ELE) AI Stock Analysis

• Market Cap: C$312.12M
• Dividend Yield: N/A
• Average Volume (3M): 76.80K
• Price to Earnings (P/E): 105.1
• Beta (1Y): 0.75
• Revenue Growth: 43.84%
• EPS Growth: N/A
• Country: CA
• Employees: 21
• Sector: Real Estate
• Sector Strength: 63
• Industry: Gold
• EPS (TTM): 0.01
• Shares Outstanding: 245,762,590
• 10 Day Avg. Volume: 54,930
• 30 Day Avg. Volume: 76,799
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 15.11
• Price to Cash Flow (P/CF): 32.70
• P/FCF Ratio: 827.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$2.00
• Price Target Upside: 57.48% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

Elemental Royalties shows strengths in revenue growth and operational efficiency, supported by a strong equity position and low leverage. However, challenges with net profitability, negative free cash flow, and high valuation metrics limit the attractiveness. The earnings call and recent corporate events provide positive momentum but are balanced by operational delays and valuation concerns.

Elemental Royalties Business Overview & Revenue Model

Company Description

Elemental Royalties (ELE) is a royalty company focused on acquiring royalties and streams in the mining sector. The company primarily engages in the acquisition of royalties on precious metals projects, including gold, silver, and other critical minerals. By investing in a diversified portfolio of high-quality royalty assets, Elemental Royalties aims to provide shareholders with exposure to foundational resources while benefiting from the sustainable growth of its underlying assets.

How the Company Makes Money

Elemental Royalties makes money through the acquisition and management of royalty and streaming agreements with mining companies. In a royalty agreement, the company earns a percentage of the revenues or production from a mine, typically calculated based on the quantity of minerals extracted and sold. Streaming agreements allow Elemental Royalties to purchase a portion of a mine's future output at a predetermined price, which it can then sell at prevailing market prices. These agreements provide a stable cash flow and exposure to commodity price fluctuations without the operational risks associated with direct mining activities. The company's strategic partnerships with mining operators and its focus on acquiring interests in high-quality, long-life mining projects are significant factors contributing to its revenue growth.

Elemental Royalties Financial Statement Overview

Summary

Elemental Royalties demonstrates solid revenue growth and operational efficiency, with strong equity and low leverage enhancing financial stability. However, challenges in net profitability and negative free cash flow highlight the need for improved cost management and cash generation to support sustainable growth.

Income Statement

Elemental Royalties has shown notable revenue growth with a 25.70% increase from 2023 to the TTM period. The gross profit margin improved to 54.00%, indicating efficient cost management. However, the net profit margin is relatively low at 11.38%, reflecting challenges in converting revenue growth into net profitability. The positive EBIT and EBITDA margins of 30.65% and 48.16%, respectively, suggest operational efficiency, yet the conversion to net income needs enhancement.

Balance Sheet

The company maintains a strong equity position with an equity ratio of 86.66%, indicating a stable financial structure predominantly funded by equity. The debt-to-equity ratio is 0.13, reflecting low leverage and minimal risk from debt obligations. Return on equity (ROE) stands at 1.08%, indicating limited returns on shareholder investments, which presents a potential area for improvement.

Cash Flow

While operating cash flow surpasses net income, indicating good cash conversion, free cash flow remains negative, which could impact future investments and growth opportunities. The operating cash flow to net income ratio of 1.93 suggests effective cash management, but improving the free cash flow to net income ratio, currently negative, is critical.

Breakdown
TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement		Total Revenue
14.76M	11.74M	9.64M	6.61M	5.12M	2.42M
	Gross Profit
7.97M	4.84M	4.09M	3.73M	3.43M	1.71M
	EBIT
4.53M	259.00K	-3.29M	-302.00K	-275.87K	777.25K
	EBITDA
7.11M	7.86M	-8.41M	2.55M	2.93M	1.48M
	Net Income Common Stockholders
1.68M	-3.90M	-18.21M	-4.73M	-2.63M	-81.81K
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
206.19K	11.29M	17.48M	6.11M	10.92M	812.57K
	Total Assets
0.00	188.92M	185.93M	76.50M	28.04M	6.67M
	Total Debt
0.00	30.00M	30.04M	24.43M	1.00	0.00
	Net Debt
206.19K	18.71M	12.56M	18.32M	-10.92M	-812.57K
	Total Liabilities
0.00	33.72M	39.50M	26.02M	1.14M	293.42K
	Stockholders Equity
4.09M	155.20M	146.43M	50.47M	26.91M	6.37M
Cash Flow		Free Cash Flow
-1.50M	-3.58M	-13.39M	-39.02M	-9.03M	504.03K
	Operating Cash Flow
3.24M	1.99M	-723.00K	1.12M	2.09M	1.01M
	Investing Cash Flow
6.05M	-5.55M	-3.39M	-40.12M	-11.01M	-503.08K
	Financing Cash Flow
-12.15M	-2.63M	15.76M	34.20M	19.03M	102.23K

Elemental Royalties Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.27
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ELE, the sentiment is Negative. The current price of 1.27 is below the 20-day moving average (MA) of 1.29, above the 50-day MA of 1.22, and above the 200-day MA of 1.16, indicating a neutral trend. The MACD of 0.03 indicates Positive momentum. The RSI at 51.81 is Neutral, neither overbought nor oversold. The STOCH value of 36.16 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:ELE.

Elemental Royalties Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SSL	70 Outperform	$3.11B	160.94	1.00%	0.76%	0.80%	137.87%
Sector *	61 Neutral	$4.72B	17.64	-3.07%	10.89%	5.99%	-21.86%
ELE	60 Neutral	C$312.12M	105.08	1.18%	―	43.84%	―
OR	56 Neutral	$5.51B	247.32	1.33%	0.89%	1.62%	-232.31%
LIO	55 Neutral	C$81.88M	―	-12.04%	―	3111.09%	-120.48%
SPOT	44 Neutral	$22.74M	―	-25.10%	―	53.16%	33.43%

Elemental Royalties Corporate Events

Elemental Altus Gains from Korali-Sud Gold Production Boost

Elemental Altus Royalties Corp. has reported significant financial gains from Allied Gold Corporation’s production at the Korali-Sud site, where the company holds a 3% NSR royalty. The production of approximately 48,000 ounces of gold in Q4 2024 marks the first full quarter of output, with expectations of increased revenue from milestone payments and ongoing production. This development enhances Elemental Altus’ market position, with significant resource potential in the Sadiola Mine Complex and future opportunities from ongoing exploration efforts.

Elemental Altus Welcomes New Director to Board

Elemental Altus Royalties Corp. has appointed Matthieu Bos as an independent non-executive director, replacing Jack Lunnon under the investor rights agreement with La Mancha. Bos brings a wealth of experience in mining capital markets and business development, which is expected to enhance the company’s growth and shareholder value.

Elemental Altus Royalties Gains from Key Projects

Elemental Altus Royalties is set to benefit from significant funding and development plans impacting its holdings in Canada and Australia. Fireweed Metals Corp has secured up to C$35.4 million in funding from US and Canadian sources to advance the Mactung Project, where Elemental Altus holds a 4% royalty. Meanwhile, Rumble Resources is progressing with a joint venture to expedite the Western Queen Gold Project, where Elemental Altus also holds a royalty interest.

Elemental Altus Royalties Releases 2024 Asset Handbook

Elemental Altus Royalties Corporation has released its 2024 Annual Asset Handbook, showcasing a robust portfolio with significant growth in royalties and project updates. The company has doubled its producing royalties in key gold mines and expanded its ownership in exploration assets. This release highlights Elemental Altus’s strategic advancements and strong prospects for continued growth.

Elemental Altus Royalties Revamps Board Structure

Elemental Altus Royalties Corp. has announced a strategic refreshment of its Board of Directors, reducing its size to enhance independence and decision-making. The company has also formed a Nominating & Governance Committee to ensure effective corporate governance and is planning to appoint independent directors.

Elemental Altus Reports Record Growth and Acquisitions

Elemental Altus Royalties reported record quarterly cash flow and EBITDA, highlighting significant financial growth. The company secured a new portfolio of royalties, enhancing its asset base and setting the stage for further revenue growth. With strategic acquisitions and strong operational cash flow, Elemental Altus is poised for continued success in the coming years.

Elemental Altus Expands Credit Facility to $50 Million

Elemental Altus Royalties has expanded its revolving credit facility to $50 million, bringing Royal Bank of Canada onboard as a new lender alongside National Bank of Canada and Canadian Imperial Bank of Commerce. The company plans to use this increased capacity for non-dilutive royalty acquisitions, leveraging strong cash flows to reduce debt.