Advertisement

Vox Royalty Corp. (CVE:VOX) Could Be Less Than A Year Away From Profitability

We feel now is a pretty good time to analyse Vox Royalty Corp.'s (CVE:VOX) business as it appears the company may be on the cusp of a considerable accomplishment. Vox Royalty Corp. operates as a mining royalty and streaming company. The CA$138m market-cap company posted a loss in its most recent financial year of US$4.1m and a latest trailing-twelve-month loss of US$5.4m leading to an even wider gap between loss and breakeven. As path to profitability is the topic on Vox Royalty's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Check out our latest analysis for Vox Royalty

Vox Royalty is bordering on breakeven, according to the 3 Canadian Metals and Mining analysts. They expect the company to post a final loss in 2021, before turning a profit of US$200k in 2022. So, the company is predicted to breakeven approximately a year from now or less! How fast will the company have to grow to reach the consensus forecasts that anticipate breakeven by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 64% year-on-year, on average, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
earnings-per-share-growth

Underlying developments driving Vox Royalty's growth isn’t the focus of this broad overview, however, bear in mind that typically metals and mining companies, depending on the stage of operation and metals mined, have irregular periods of cash flow. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that Vox Royalty has no debt on its balance sheet, which is quite unusual for a cash-burning metals and mining company, which typically has high debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

There are too many aspects of Vox Royalty to cover in one brief article, but the key fundamentals for the company can all be found in one place – Vox Royalty's company page on Simply Wall St. We've also put together a list of pertinent factors you should further examine:

  1. Valuation: What is Vox Royalty worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Vox Royalty is currently mispriced by the market.

  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Vox Royalty’s board and the CEO’s background.

  3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here