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Equatorial Resources Limited (AU:EQX)
ASX:EQX

Equatorial Resources Limited (EQX) AI Stock Analysis

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AU

Equatorial Resources Limited

(Sydney:EQX)

Rating:28Underperform
Price Target:
Equatorial Resources Limited presents a challenging investment case with significant financial difficulties, including zero revenue and consistent losses, coupled with a negative cash flow. Technical indicators suggest bearish momentum, and valuation metrics are unattractive due to a negative P/E ratio and absence of dividends. The company's lack of operational income and declining financial health are primary concerns, overshadowing any potential strengths such as the absence of debt.

Equatorial Resources Limited (EQX) vs. iShares MSCI Australia ETF (EWA)

Equatorial Resources Limited Business Overview & Revenue Model

Company DescriptionEquatorial Resources Limited explores for and develops iron ore properties in the Republic of Congo. The company was incorporated in 1986 and is headquartered in Perth, Australia.
How the Company Makes MoneyEquatorial Resources Limited generates revenue primarily through the exploration and potential development of its iron ore projects. The company's revenue model centers around identifying and developing mineral resources that can be economically extracted and sold in the global commodities market. Key revenue streams include the sale of extracted minerals, potential joint ventures, and partnerships that may provide funding and resource-sharing opportunities to advance project development. Significant factors contributing to the company's earnings include the global demand and pricing for iron ore, successful exploration outcomes, and the ability to secure necessary financing and governmental approvals for project advancement. Additionally, strategic partnerships or agreements with other mining companies or investors can also play a crucial role in funding operations and sharing the risks and rewards of developing mineral assets.

Equatorial Resources Limited Financial Statement Overview

Summary
Equatorial Resources Limited is facing significant financial challenges, characterized by zero revenue, consistent losses, and negative cash flows. While the balance sheet shows no debt, the declining equity and assets raise concerns about long-term viability. The company needs to address its operational inefficiencies and cash flow issues to improve its financial health.
Income Statement
15
Very Negative
The company has reported zero revenue over the years, indicating no operational income stream. There are consistent net losses, with a slightly reduced net loss in the latest year compared to previous years. EBIT and EBITDA margins are negative, reflecting operating inefficiencies and high cost relative to nonexistent revenue.
Balance Sheet
40
Negative
The company maintains a strong equity position with no debt, as indicated by the zero debt-to-equity ratio, which reduces financial risk. However, the decline in stockholders' equity over the years suggests potential financial instability. The equity ratio remains high, but shrinking assets could be a concern.
Cash Flow
20
Very Negative
The company exhibits negative operating and free cash flows, indicating cash outflows from operations without adequate cash inflows. Free cash flow has deteriorated over the years, suggesting declining financial flexibility. The lack of growth in cash flow metrics highlights ongoing cash management challenges.
Breakdown
TTMJun 2024Jun 2023Jun 2022Jun 2021Jun 2020
Income StatementTotal Revenue
0.000.000.000.000.000.00
Gross Profit
0.000.000.000.000.000.00
EBIT
-1.04M-1.77M-2.14M-1.48M-893.60K
EBITDA
-1.60M-726.05K0.00138.68K-1.48M0.00
Net Income Common Stockholders
-1.59M-1.76M-4.19M-17.26M-7.58M-171.54K
Balance SheetCash, Cash Equivalents and Short-Term Investments
12.62M13.82M16.66M18.45M35.22M40.30M
Total Assets
14.70M15.90M16.69M18.50M35.25M42.53M
Total Debt
0.000.000.000.000.000.00
Net Debt
-12.62M-13.82M-16.66M-18.45M-19.96M-40.30M
Total Liabilities
1.39M1.85M2.49M297.11K163.45K221.69K
Stockholders Equity
14.57M15.31M15.90M19.90M36.78M43.56M
Cash FlowFree Cash Flow
-2.83M-1.79M-1.51M-961.49K23.75K
Operating Cash Flow
-2.83M-1.79M-1.51M-961.49K23.75K
Investing Cash Flow
0.00-7.62K0.000.00-19.82M0.00
Financing Cash Flow
0.00-6.43K0.000.00445.77K0.00

Equatorial Resources Limited Technical Analysis

Technical Analysis Sentiment
Positive
Last Price0.16
Price Trends
50DMA
0.12
Positive
100DMA
0.12
Positive
200DMA
0.12
Positive
Market Momentum
MACD
<0.01
Negative
RSI
63.00
Neutral
STOCH
88.89
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:EQX, the sentiment is Positive. The current price of 0.16 is above the 20-day moving average (MA) of 0.14, above the 50-day MA of 0.12, and above the 200-day MA of 0.12, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 63.00 is Neutral, neither overbought nor oversold. The STOCH value of 88.89 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:EQX.

Equatorial Resources Limited Peers Comparison

Overall Rating
UnderperformOutperform
Sector (51)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
51
Neutral
$2.04B-1.21-21.10%3.95%2.90%-30.45%
AUEQX
28
Underperform
AU$18.40M-15.31%32.72%
TSCIA
C$2.12B14.5910.03%4.98%
$126.79B11.2626.20%3.88%
$31.31B8.2820.21%6.03%
$138.79M4.045.68%5.01%
$206.44M65.86-35.86%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
AU:EQX
Equatorial Resources Limited
0.16
0.02
14.29%
TSE:CIA
Champion Iron
3.89
-1.91
-32.93%
BHPLF
BHP Group Ltd
25.60
-2.18
-7.85%
FSUMF
Fortescue Metals Group Ltd
10.45
-3.86
-26.97%
GRRLF
Grange Resources Limited
0.13
-0.08
-38.10%
MTGRF
Mount Gibson Iron Limited
0.21
-0.06
-22.22%

Equatorial Resources Limited Corporate Events

Equatorial Resources Faces Arbitration Delay, Advances Nimba Project
Apr 30, 2025

Equatorial Resources Limited has experienced a delay in its international arbitration case against the Republic of Congo, with the final hearing now rescheduled to November 2025 in Washington, DC. This arbitration stems from disputes over the company’s investments in two iron ore projects in Congo. Meanwhile, Equatorial continues to advance its Nimba Alliance Iron Ore Project in Guinea, which shows promising high-grade iron mineralization and is strategically located near major iron ore projects. The company maintains a strong financial position, with substantial cash reserves to support its ongoing projects and legal proceedings.

Equatorial Resources’ Arbitration Hearing Against Congo Postponed
Mar 9, 2025

Equatorial Resources Limited announced a postponement of its final arbitration hearing against the Republic of Congo, initially scheduled for March 2025, due to Congo’s failure to cover hearing expenses. The dispute, initiated in 2021, involves alleged unlawful actions by Congo affecting Equatorial’s iron ore investments, with the hearing now proposed for August or November 2025.

Equatorial Resources Limited Releases Interim Financial Report for 2024
Mar 6, 2025

Equatorial Resources Limited has released its interim financial report for the half year ending December 31, 2024. The report is intended to be read in conjunction with the company’s annual report and any public announcements made during the interim period. The release of this financial report is part of the company’s compliance with continuous disclosure requirements, providing stakeholders with insights into its financial performance and position.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.