Torex Gold Resources (TXG) AI Stock Analysis

• Market Cap: $2.66B
• Dividend Yield: N/A
• Average Volume (3M): 289.37K
• Price to Earnings (P/E): 14.3
• Beta (1Y): 1.12
• Revenue Growth: 28.22%
• EPS Growth: -33.06%
• Country: CA
• Employees: 4,594
• Sector: Basic Materials
• Sector Strength: 56
• Industry: Mining
• EPS (TTM): 2.15
• Shares Outstanding: 86,162,880
• 10 Day Avg. Volume: 300,705
• 30 Day Avg. Volume: 289,365
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.75
• Price to Cash Flow (P/CF): 4.00
• 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$39.43
• Price Target Upside: 27.89% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 7

Torex Gold Resources demonstrates solid financial performance with strong revenue growth and operational achievements, notably in the Media Luna project. However, declining profitability metrics and high capital expenditures leading to negative free cash flow present challenges. The stock's technical indicators suggest neutral momentum, while its valuation is fair but lacks a dividend yield. Despite these concerns, strategic developments and positive guidance provide a balanced outlook.

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.

Operational Guidance

The company achieved 2024 production guidance with 452.5koz, marking the sixth consecutive year of achieving guidance and underscoring the company's strong operational track record.

Negative Factors

Operational Challenges

Production during the quarter was impacted by a roughly 10-day shutdown in December as a result of three fatalities at ELG Underground; operations have since returned to full capacity.

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: Negative
• Last Price: 30.83
• 50DMA: Negative
• 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:TXG, the sentiment is Negative. The current price of 30.83 is below the 20-day moving average (MA) of 32.81, below the 50-day MA of 30.86, and above the 200-day MA of 26.71, indicating a neutral trend. The MACD of 0.11 indicates Positive momentum. The RSI at 44.25 is Neutral, neither overbought nor oversold. The STOCH value of 44.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:TXG.

Torex Gold Resources Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AEM	80 Outperform	C$70.51B	27.34	9.42%	1.62%	26.99%	-6.63%
ELD	74 Outperform	C$4.24B	10.64	8.12%	―	27.29%	―
IMG	72 Outperform	C$4.21B	3.64	29.57%	―	―	―
TXG	68 Neutral	$2.66B	14.33	8.61%	―	28.22%	-33.06%
NGD	68 Neutral	C$3.17B	22.80	11.14%	―	18.32%	―
BTO	54 Neutral	C$4.96B	―	-18.54%	5.99%	-4.17%	-318.18%
Sector *	47 Neutral	$2.64B	-4.00	-31.55%	3.33%	2.93%	-29.90%

Torex Gold Resources Corporate Events

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.

Torex Gold Outlines 2025 Operational Goals and Production Outlook

Torex Gold Resources has announced its 2025 operational guidance and an updated five-year production outlook for the Morelos Complex. The company anticipates a pivotal year with the completion of the Media Luna Project, which will enable simultaneous production from both sides of the Balsas River and mark its entry as a significant copper producer. Despite a planned four-week shutdown of the processing plant, Torex expects to return to positive free cash flow by mid-year, signaling a potential positive impact on its financial health and industry positioning.

Torex Gold Achieves 2024 Production Targets, Eyes Future Growth

Torex Gold reported a full-year gold production of 452,523 ounces in 2024, aligning with its revised guidance range despite operational disruptions in December due to a tragic incident at its ELG Underground site. The company maintained consistent performance throughout the year, marking its sixth consecutive year of meeting production guidance, and it anticipates further growth and transformation with the completion of the Media Luna Project and other strategic initiatives in 2025.

Torex Gold Resumes Operations at Morelos Complex

Torex Gold Resources has announced the resumption of operations at its Morelos Complex after a temporary suspension was lifted. The company is on track to meet its 2024 production guidance, despite previous challenges. The Media Luna Project schedule remains unchanged, with operations set to ramp up in February 2025.