Rio2 Limited (RIO) AI Stock Analysis

• Market Cap: C$380.17M
• Dividend Yield: N/A
• Average Volume (3M): 578.40K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.52
• Revenue Growth: N/A
• EPS Growth: 83.41%
• Country: CA
• Employees: 185
• Sector: Basic Materials
• Sector Strength: 59
• Industry: Gold
• EPS (TTM): -0.01
• Shares Outstanding: 424,771,700
• 10 Day Avg. Volume: 907,337
• 30 Day Avg. Volume: 578,401
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• Price to Cash Flow (P/CF): -38.40
• P/FCF Ratio: 0.00
• 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$1.40
• Price Target Upside: 55.56% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

Rio2 Limited faces critical financial challenges due to the lack of revenue generation and consistent losses. Despite a strong cash position, the company's reliance on financing is unsustainable. Technical indicators offer some hope of upward momentum, while the start of the Fenix Gold Mine construction is a positive corporate development that could improve future financial prospects. However, valuation concerns remain significant due to a negative P/E ratio and no dividend yield.

Positive Factors

Experienced Management

The management team comes from Rio Alto, which was highly successful prior to its merger with Tahoe Resources.

Project Financing

The Company recently obtained a $174M construction financing package and has since moved forward with construction.

Negative Factors

Stock Valuation

RIO trades at only $26/oz compared to its peers at $88/oz.

Rio2 Limited Business Overview & Revenue Model

Company Description

Rio2 Limited is a mining company primarily engaged in the exploration and development of mineral properties in the precious metals sector. The company focuses on advancing its flagship Fenix Gold Project located in Chile, which is one of the largest undeveloped gold oxide projects in the Americas. Rio2's core business involves the discovery, development, and potential production of gold resources, aiming to create value through strategic project management and sustainable mining practices.

How the Company Makes Money

Rio2 Limited generates revenue primarily through the development and eventual production of gold from its mining projects. The company focuses on advancing its Fenix Gold Project towards production, which involves exploration activities, securing necessary permits, and constructing mining facilities. Once operational, the company will earn money by extracting gold from the mine and selling it in the global commodities market. Revenue streams are also supported by any strategic partnerships or joint ventures that may provide funding or operational synergies. The company's earnings are influenced by factors such as gold market prices, cost management, and efficient project execution.

Rio2 Limited Financial Statement Overview

Summary

Rio2 Limited is experiencing severe financial difficulties, with no revenue and ongoing losses affecting profitability. Although the balance sheet shows limited leverage, the negative cash flow from operations underlines the need for strategic adjustments and improved cash generation.

Income Statement

Rio2 Limited has faced significant challenges in generating revenue, with zero revenue reported consistently over multiple periods. The net profit margin is negative, and the company is incurring substantial losses, as indicated by the negative net income figures. Gross profit and EBIT margins are also negative, reflecting operational inefficiencies. The lack of revenue growth is a major concern for future profitability.

Balance Sheet

The company's balance sheet reveals a moderate level of financial stability, with a low debt-to-equity ratio indicating minimal leverage. However, the return on equity (ROE) is negative due to persistent losses, which raises concerns about shareholder returns. The equity ratio is relatively healthy, showcasing a solid equity base compared to total assets. However, the company's ability to convert equity into profit remains a challenge.

Cash Flow

Rio2 Limited's cash flow statement highlights issues with cash generation, particularly in operating activities, which are consistently negative. The free cash flow growth rate is negative, and the cash flow ratios indicate difficulty in converting net income into cash. Despite positive financing cash flow, likely from debt or equity issuance, the reliance on external funding is not sustainable long-term.

Breakdown
TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement		Total Revenue
0.00	0.00	0.00	0.00	0.00	0.00
	Gross Profit
-913.20K	―	-2.28M	-76.17K	-78.62K	-39.08K
	EBIT
-5.73M	―	-13.74M	-13.25M	―	―
	EBITDA
-6.45M	―	972.44K	-12.96M	-11.89M	-9.01M
	Net Income Common Stockholders
-9.10M	-12.33M	-2.30M	-10.53M	―	―
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
808.77K	4.60M	4.73M	21.39M	3.43M	14.91M
	Total Assets
52.26M	108.42M	115.06M	95.70M	73.49M	72.00M
	Total Debt
0.00	465.33K	713.40K	485.31K	479.99K	0.00
	Net Debt
-808.77K	-4.09M	-3.97M	-20.86M	-2.12M	-4.14M
	Total Liabilities
1.78M	35.21M	33.23M	7.33M	6.37M	2.96M
	Stockholders Equity
50.48M	73.21M	81.83M	88.36M	67.11M	69.04M
Cash Flow		Free Cash Flow
-5.81M	-2.28M	-35.47M	-15.20M	―	―
	Operating Cash Flow
-3.88M	-331.23K	-3.87M	-9.33M	―	―
	Investing Cash Flow
-1.93M	-1.95M	-31.60M	-2.13M	2.37M	―
	Financing Cash Flow
15.53M	-180.55K	25.88M	30.97M	3.98M	22.90M

Rio2 Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.90
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:RIO, the sentiment is Positive. The current price of 0.9 is above the 20-day moving average (MA) of 0.87, above the 50-day MA of 0.80, and above the 200-day MA of 0.67, indicating a bullish trend. The MACD of 0.03 indicates Negative momentum. The RSI at 58.61 is Neutral, neither overbought nor oversold. The STOCH value of 72.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:RIO.

Rio2 Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	49 Neutral	$1.93B	-1.63	-22.26%	3.87%	0.68%	-27.45%
GQC	48 Neutral	C$155.67M	―	-26.93%	―	―	25.41%
PRB	45 Neutral	C$410.80M	―	-109.44%	―	―	10.27%
RIO	43 Neutral	C$380.17M	―	0.21%	―	―	83.41%
AUMN	38 Underperform	$2.69M	―	-322.42%	―	-100.00%	54.27%

Rio2 Limited Corporate Events

Rio2 Limited Commences Construction of Fenix Gold Mine

Rio2 Limited announced the official start of construction for its Fenix Gold Mine in the Maricunga Gold Belt, marking a significant milestone for the company. The event highlighted the project’s importance, attended by government officials, indigenous community representatives, and industry leaders, which underscores its potential impact on local economic development and the mining sector.