Torex Gold Resources (TXG) AI Stock Analysis

• Market Cap: $3.79B
• Dividend Yield: N/A
• Average Volume (3M): 382.55K
• Price to Earnings (P/E): 20.4
• Beta (1Y): 1.23
• Revenue Growth: 28.22%
• EPS Growth: -33.06%
• Country: CA
• Employees: 883
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Gold
• EPS (TTM): 2.15
• Shares Outstanding: 86,162,980
• 10 Day Avg. Volume: 470,526
• 30 Day Avg. Volume: 382,551
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.95
• Price to Cash Flow (P/CF): 4.40
• 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$48.29
• Price Target Upside: 9.92% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

Torex Gold Resources presents a strong financial and operational profile with significant revenue growth and positive market momentum. However, declining net profit margins, negative free cash flow, and increased operating costs pose challenges. The technical picture is robust, but valuation metrics and absence of dividends might limit attractiveness to some investors. Despite these concerns, strategic projects like Media Luna and positive corporate developments offer promising long-term growth potential.

Positive Factors

Financial Performance

Torex's Q4 financial results were broadly better than BMO and consensus estimates, with EPS of $0.81 beating BMO/consensus of $0.46/$0.63.

Growth Opportunities

There is potential for shares to re-rate higher as value is unlocked at Media Luna, indicating growth opportunities for investors.

Operational Efficiency

Gold recovery of 90.4% exceeded the forecast, highlighting the company's operational efficiency and potential for increased profitability.

Negative Factors

Future Production

Copper is expected to begin making a meaningful contribution to total production in Q2, which suggests a dependency on future production outcomes.

Reserve Estimates

The increase in reserves was a result of the inaugural reserve estimate for EPO Underground, which may imply uncertainties in reserve sustainability.

Torex Gold Resources Business Overview & Revenue Model

Company Description

Torex Gold Resources Inc. is a leading Canadian-based intermediate gold producer engaged in the exploration, development, and operation of mineral properties. The company's primary asset is the Morelos Gold Property in Mexico, which includes the El Limón Guajes (ELG) mining complex and the Media Luna project. Torex Gold focuses on maintaining its status as a low-cost gold producer, leveraging its significant mineral reserves and operational expertise to deliver sustainable value to its stakeholders.

How the Company Makes Money

Torex Gold Resources generates revenue primarily through the extraction and sale of gold from its mining operations at the El Limón Guajes complex. The company sells the extracted gold to various customers, including refineries and financial institutions, based on prevailing market prices. Additionally, Torex Gold may engage in the sale of other by-products such as silver, which is often found in conjunction with gold deposits. The company's earnings are influenced by factors such as gold production levels, market gold prices, operational efficiencies, and cost control measures. Strategic partnerships and joint ventures for exploration and development projects also play a role in expanding its resource base and potential revenue streams.

Torex Gold Resources Financial Statement Overview

Summary

Torex Gold Resources shows considerable revenue growth and operational strength, but declining net margins and profitability metrics are concerning. The balance sheet is robust with low leverage, enhancing financial stability. While cash flow from operations is strong, high capital expenditures have led to negative free cash flow, indicating a need for strategic capital allocation.

Income Statement

Torex Gold Resources has demonstrated strong revenue growth with a 26.36% increase from 2023 to 2024. The gross profit margin for 2024 is 41.99%, showcasing efficient cost management. However, the net profit margin decreased to 12.06% in 2024 from 23.15% in 2023, indicating rising expenses or lower profitability. The absence of EBIT in 2024 is concerning, but a strong EBITDA margin of 48.66% reflects robust operational performance.

Balance Sheet

The company's balance sheet shows a solid equity position, with an equity ratio of 76.21% in 2024, indicating financial stability. The debt-to-equity ratio is low at 0.09, suggesting conservative leverage. Return on equity decreased to 8.26% in 2024 from 13.67% in 2023, reflecting reduced profitability.

Cash Flow

Operating cash flow grew significantly by 49.43% in 2024, highlighting strong cash generation. However, free cash flow remained negative at -$112.2 million, primarily due to high capital expenditures. The operating cash flow to net income ratio is strong at 3.34, showing effective cash conversion, but the negative free cash flow to net income ratio indicates the need for better capital management.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.12B	882.60M	868.50M	855.80M	789.20M
	Gross Profit
468.20M	484.60M	303.90M	326.50M	257.20M
	EBIT
0.00	453.10M	276.50M	298.50M	218.10M
	EBITDA
542.70M	432.80M	488.10M	460.20M	399.30M
	Net Income Common Stockholders
134.60M	204.40M	188.80M	151.70M	109.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
110.20M	172.80M	376.00M	255.70M	206.20M
	Total Assets
2.14B	1.84B	1.59B	1.36B	1.25B
	Total Debt
141.20M	32.00M	3.90M	3.30M	43.40M
	Net Debt
31.00M	-140.80M	-372.10M	-252.40M	-130.70M
	Total Liabilities
508.90M	340.70M	303.20M	258.50M	306.30M
	Stockholders Equity
1.63B	1.50B	1.29B	1.10B	946.10M
Cash Flow		Free Cash Flow
-112.20M	-178.70M	130.50M	99.50M	199.70M
	Operating Cash Flow
449.50M	300.80M	408.10M	330.00M	342.10M
	Investing Cash Flow
-562.70M	-498.30M	-280.50M	-203.70M	-177.60M
	Financing Cash Flow
53.60M	-7.90M	-7.70M	-44.90M	-150.00M

Torex Gold Resources Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 43.93
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:TXG, the sentiment is Positive. The current price of 43.93 is above the 20-day moving average (MA) of 38.50, above the 50-day MA of 35.20, and above the 200-day MA of 28.80, indicating a bullish trend. The MACD of 1.82 indicates Negative momentum. The RSI at 71.90 is Negative, neither overbought nor oversold. The STOCH value of 88.31 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:TXG.

Torex Gold Resources Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IMG	80 Outperform	$5.81B	5.00	29.57%	―	71.21%	667.30%
AEM	80 Outperform	$83.04B	31.62	9.42%	1.36%	26.99%	-6.63%
ELD	79 Outperform	$5.52B	13.81	8.12%	―	33.06%	177.69%
TXG	73 Outperform	$3.79B	20.40	8.61%	―	28.22%	-33.06%
NGD	73 Outperform	$3.92B	28.94	11.14%	―	18.32%	―
BTO	66 Neutral	$5.90B	―	-18.54%	4.12%	-0.18%	-2195.85%
Sector *	48 Neutral	$1.92B	-1.99	-22.85%	3.95%	0.94%	-27.31%

Torex Gold Resources Corporate Events

Torex Gold Achieves Key Milestones in Q1 2025, On Track for Annual Targets

Torex Gold Resources reported its Q1 2025 production results, achieving significant milestones such as completing processing plant tie-ins and producing its first copper concentrate. The company produced 59,630 ounces of gold equivalent and is on track to meet its annual production guidance of 400,000 to 450,000 ounces. The successful commissioning of the Guajes Tunnel conveyor and progress in the Media Luna Underground project are expected to enhance production rates, with a forecasted improvement in Q2 and a return to positive free cash flow later in the year.

Spark’s Take on TSE:TXG Stock

According to Spark, TipRanks’ AI Analyst, TSE:TXG is a Outperform.

Torex Gold Resources presents a strong financial and operational profile with significant revenue growth and positive market momentum. However, declining net profit margins, negative free cash flow, and increased operating costs pose challenges. The technical picture is robust, but valuation metrics and absence of dividends might limit attractiveness to some investors. Despite these concerns, strategic projects like Media Luna and positive corporate developments offer promising long-term growth potential.

To see Spark’s full report on TSE:TXG stock, click here.

Torex Gold Extends Reserve Life and Boosts Production Outlook

Torex Gold Resources has reported its year-end 2024 mineral reserves and resources for the Morelos Complex, highlighting a solidified annual production of at least 450,000 gold equivalent ounces through 2030, with a reserve life extending to at least 2035. The company plans to enhance its production profile beyond 2030 through extensive drilling and exploration, particularly focusing on the EPO Underground deposit, which saw a significant increase in inferred resources. This strategic focus on extending reserve life and optimizing production underscores Torex’s commitment to maintaining its competitive position in the mining industry.

Torex Gold Reports Promising Drill Results at Media Luna Sites

Torex Gold Resources has reported outstanding drill results from the Media Luna West and East sites, part of its broader exploration efforts in the Morelos Complex. These results, including high-grade intercepts of gold and copper, highlight the significant resource potential and exploration upside in the area. The company plans further drilling and aims for an inaugural Inferred Resource estimate by the end of 2025, with the ultimate goal of sustaining substantial annual gold equivalent production while extending the operational life beyond 2035.

Torex Gold Reports Record Revenue and Tragedy in 2024

Torex Gold Resources reported strong financial and operational results for 2024, achieving record revenue of over $1.1 billion and gold production exceeding 452,000 ounces. The company is on track to generate positive free cash flow by mid-2025, supported by its Media Luna Project. Despite these successes, the year was marked by a tragic incident resulting in the loss of three lives, prompting a renewed focus on safety. Torex aims to enhance its safety standards and is expanding exploration and drilling activities, positioning itself for continued growth.

Torex Gold’s Media Luna Project Nears Completion with First Copper Concentrate Imminent

Torex Gold Resources has announced that its Media Luna Project is nearing completion, with 94% of the work finished as of the end of 2024. The company is on track to produce its first copper concentrate by March 2025, marking a significant milestone in the project’s development. Underground development and drilling activities are ahead of schedule, potentially accelerating mining rates and enhancing operational efficiency. The company expects Q1 2025 to be the last quarter of significant capital expenditure for the project, anticipating a transition to positive cash flow by mid-year. This financial strengthening will allow Torex to repay debt, return capital to shareholders, and support future growth initiatives.