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Endeavour Mining (TSE:EDV)
:EDV
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Endeavour Mining
(TSX:EDV)
73Outperform
Positive Factors
Asset Portfolio
Endeavour has the building blocks of a quality asset portfolio in place with a 1.2-1.3Moz production profile and significant brownfield and greenfield growth opportunities within the portfolio.
Free Cash Flow
The company has reached FCF inflection following the completion of the Lafigué (Côte d'Ivoire) and the Sabodala-Massawa BIOX (Senegal) projects and provides a peer-leading capital returns outlook.
Negative Factors
Operational Challenges
While there are operational challenges at Sabodala-Massawa and Mana that still need to be addressed, management's guidance does incorporate some of the risks.
Production and Cost Issues
Lower-than-expected production ramp-up at Sabodala-Massawa and higher costs at Hounde negatively impact EBITDA by approximately 12%.
Regulatory Risks
The potential new mining code in Côte d'Ivoire could reduce Endeavour Mining's stake in Assafou from 80% to 75%.
Endeavour Mining (EDV) vs. S&P 500 (SPY)
Market Cap
C$8.45B
Dividend Yield3.94%
Average Volume (3M)616.42K
Price to Earnings (P/E)―
Beta (1Y)1.16
Revenue Growth22.47%
EPS Growth-791.36%
CountryCA
Employees5,659
SectorBasic Materials
Sector Strength52
IndustryGold
Share Statistics
EPS (TTM)-1.69
Shares Outstanding241,872,480
10 Day Avg. Volume619,840
30 Day Avg. Volume616,423
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)2.07
Price to Cash Flow (P/CF)3.60
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$41.90Price Target Upside19.99% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering14
Endeavour Mining Business Overview & Revenue Model
Company DescriptionEndeavour Mining plc, together with its subsidiaries, operates as a gold mining company in West Africa. Its project portfolio includes 90% owned Houndé, Mana, Boungou, and Wahgnion mines in Burkina Faso; 85% owned Ity mine located in Côte d'Ivoire; 90% owned Sabodala-Massawa mine situated in Senegal; and Fetekro, Kalana, Bantou, Nabanga, and Afema development projects. The company was incorporated in 2021 and is based in London, the United Kingdom.
How the Company Makes MoneyEndeavour Mining generates revenue primarily through the production and sale of gold. The company's key revenue streams include the extraction and processing of gold ore from its mining operations, followed by the sale of refined gold to various buyers, including financial institutions and metal traders. Endeavour's earnings are significantly influenced by gold market prices, production volumes, and operational efficiencies. The company also engages in exploration activities to expand its resource base and extend the life of its mines. Strategic partnerships and joint ventures may enhance its operational capabilities and access to new resources, contributing to its revenue generation.
Endeavour Mining Financial Statement Overview
Summary
Endeavour Mining exhibits solid revenue growth and operational efficiency, but faces profitability challenges with net losses impacting returns on equity. The balance sheet is stable with moderate leverage, and cash flows are strong with significant free cash flow growth. The company is well-positioned to improve profitability and leverage its operational strengths to enhance shareholder value.Income Statement
Endeavour Mining shows strong revenue growth with a 26.5% increase from 2023 to 2024. However, the company faces challenges with profitability as indicated by consecutive net losses, resulting in a negative net profit margin. Despite this, the gross profit margin remains robust at approximately 32.5%, and the EBITDA margin is healthy at 32.1%, suggesting operational efficiency and potential for improved profitability.70
Positive
Balance Sheet
The balance sheet reflects a reasonable debt-to-equity ratio of 0.43, indicating moderate leverage. The company maintains a solid equity base as shown by an equity ratio of 49.1%. However, the return on equity is negative due to net losses, highlighting a need for improved management of equity investments. The company's asset base decreased slightly, suggesting a focus on optimizing resources.65
Positive
Cash Flow
Endeavour Mining reports a positive free cash flow with a growth rate of 322% from 2023 to 2024, demonstrating improved cash management. The operating cash flow to net income ratio is strong at -3.14, indicating that the company generates substantial cash flows from operations despite net losses. Free cash flow to net income ratio is positive, reflecting effective capital expenditure management.75
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 2.68B | 2.11B | 2.51B | 2.78B | 1.42B | Gross Profit |
| 868.70M | 745.30M | 759.70M | 890.80M | 490.04M | EBIT |
| 367.80M | 442.70M | 587.70M | 710.00M | 338.23M | EBITDA |
| 857.90M | 1.10B | 1.20B | 1.14B | 700.37M | Net Income Common Stockholders |
| -300.20M | -208.90M | -31.00M | 215.50M | 133.87M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 418.60M | 517.20M | 962.30M | 906.20M | 644.97M | Total Assets |
| 5.51B | 5.86B | 6.41B | 6.77B | 3.88B | Total Debt |
| 1.17B | 1.11B | 871.80M | 893.00M | 725.47M | Net Debt |
| 777.00M | 593.40M | -79.30M | -13.20M | 80.50M | Total Liabilities |
| 2.52B | 2.31B | 2.33B | 2.39B | 1.64B | Stockholders Equity |
| 2.71B | 3.23B | 3.66B | 3.92B | 2.06B |
| Cash Flow | Free Cash Flow | |||
| 257.60M | -116.10M | 503.70M | 643.60M | 507.64M | Operating Cash Flow |
| 943.30M | 646.50M | 1.02B | 1.17B | 748.93M | Investing Cash Flow |
| -630.00M | -820.80M | -521.40M | -511.70M | -160.11M | Financing Cash Flow |
| -439.10M | -276.60M | -385.00M | -431.10M | -70.71M |
Endeavour Mining Technical Analysis
Positive
34.92
Price Trends
31.34
Positive
28.88
Positive
29.12
Positive
Market Momentum
1.20
Negative
71.98
Negative
83.78
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:EDV, the sentiment is Positive. The current price of 34.92 is above the 20-day moving average (MA) of 33.30, above the 50-day MA of 31.34, and above the 200-day MA of 29.12, indicating a bullish trend. The MACD of 1.20 indicates Negative momentum. The RSI at 71.98 is Negative, neither overbought nor oversold. The STOCH value of 83.78 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:EDV.
Endeavour Mining Peers Comparison
Overall Rating
UnderperformOutperform
Sector (47)
Financial Indicators
Performance Comparison
TSE:EDV
Endeavour Mining
36.68
7.81
27.05%
NGD
New Gold
3.57
1.77
98.33%
SAND
Sandstorm Gold
7.93
2.63
49.62%
BTG
B2Gold
3.24
0.50
18.25%
AGI
Alamos Gold
29.22
14.09
93.13%
OR
Osisko Gold Royalties
22.40
6.45
40.44%
Endeavour Mining Earnings Call Summary
Earnings Call Date: Mar 6, 2025 | % Change Since: 16.87% | Next Earnings Date: May 1, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong financial performance with record free cash flow and increased shareholder returns, driven by increased production and successful exploration. However, challenges remain with operational issues at Sabodala-Massawa and increased expenses.Highlights
Record Free Cash Flow Generation
Endeavor Mining achieved a record free cash flow of $268 million in Q4 2024, bringing total free cash flow to $365 million in H2 2024.
Significant Production Increase
The company produced 1.1 million ounces of gold in 2024, marking a 34% increase in Q4 as growth projects hit nameplate capacity.
Strong Financial Health and Deleveraging
Endeavor Mining reduced its leverage to 0.55 times net debt to EBITDA by the end of the year, with expectations to reach the target of less than 0.5 times soon.
Increased Shareholder Returns
Declared a record dividend for 2024 of $240 million, supplemented with $37 million of share buybacks, totaling $277 million in shareholder returns.
Improved Sustainability Performance
Achieved an improved 17.3 low-risk rating from Sustainalytics, positioning Endeavor as the best-rated gold producer on the platform.
Exploration Success
Increased group reserves by 32% to 18.4 million ounces and achieved a five-year resource discovery target a year early.
Lowlights
Challenges at Sabodala-Massawa
Faced lower recovery rates and grade issues due to low availability of high-quality ore and transitional refractory ore during the BIOX ramp-up.
Higher Operating and Other Expenses
Operating and other expenses increased by $202 million in Q4 due to higher royalties and increased mining and processing costs.
Non-cash Impairment Charges
Recognized a $200 million non-cash impairment related primarily to the Kalana property in Mali and the Golden Hill permit in Burkina Faso.
Company Guidance
In the call, Endeavor Mining provided guidance for strong operational and financial performance in 2024. The company produced 1.1 million ounces of gold at all-in sustaining costs of $1,218 per ounce, achieving a record free cash flow of $268 million in Q4, totaling $365 million in H2 2024. This financial strength allowed for a dividend of $240 million supplemented by $37 million in share buybacks, leading to a total shareholder return of $277 million. Endeavor's net debt to EBITDA ratio was reduced to 0.55 times, with a target of less than 0.5 times soon. The company aims to increase production by up to 14% in 2025, with stable all-in sustaining costs and a decrease in total mine capital by 27% to $440 million. Exploration efforts added 12.2 million ounces of resources since 2021, with a discovery cost of less than $25 per ounce. The 2024 sustainability report highlighted a low-risk 17.3 rating from Sustainalytics, marking Endeavor as the best-rated gold producer on their platform. Looking ahead to 2030, Endeavor expects to increase production by up to 36% from 2024 levels to about 1.5 million ounces.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.