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Erdene Resources (TSE:ERD)
TSX:ERD

Erdene Resources (ERD) AI Stock Analysis

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Erdene Resources

(TSX:ERD)

Rating:47Neutral
Price Target:
Erdene Resources is characterized by significant financial challenges with no revenue and recurring losses. However, positive technical trends and corporate developments, such as the progress of the Bayan Khundii Project, suggest potential future growth. The negative valuation due to losses remains a key concern.

Erdene Resources (ERD) vs. iShares MSCI Canada ETF (EWC)

Erdene Resources Business Overview & Revenue Model

Company DescriptionErdene Resources Development Corporation (ERD) is a Canadian-based resource company focused on the exploration and development of precious and base metals in the Asia-Pacific region, particularly Mongolia. The company primarily engages in the discovery, acquisition, and development of mineral resources, with a strong emphasis on gold and copper projects. Erdene's core assets include its flagship Bayan Khundii Gold Project and the Altan Nar Gold-Polymetallic Project, both located in southwestern Mongolia.
How the Company Makes MoneyErdene Resources makes money through the exploration and development of mineral resources, specifically focusing on gold and copper. The company's revenue model is primarily based on the successful discovery and development of economically viable mining projects, which can lead to the sale of mineral concentrates or the outright sale of mining assets to larger mining companies. Additionally, Erdene may enter into strategic partnerships or joint ventures with other mining companies to share the costs and benefits of exploration and development. Funding for exploration and development activities is often raised through equity financing, issuing shares to investors who believe in the company's potential for successful mineral discoveries and future profits.

Erdene Resources Financial Statement Overview

Summary
Erdene Resources faces significant financial challenges with no revenue generation and recurring losses. Despite a strong equity base and no debt, the company's reliance on financing activities to sustain operations highlights its precarious financial position.
Income Statement
10
Very Negative
Erdene Resources has consistently reported no revenue over the last several years, indicating challenges in generating sales. The company’s EBIT and net income margins are negative, reflecting ongoing operational losses. The absence of revenue growth further underscores the financial instability and lack of profitability in the current and prior periods.
Balance Sheet
40
Negative
The company maintains a strong equity position with no significant debt obligations, resulting in a zero debt-to-equity ratio, which is a positive sign of financial health. However, the lack of revenue and profitability limits the effectiveness of this strength. The equity ratio has remained robust, suggesting a stable financial structure despite operational challenges.
Cash Flow
20
Very Negative
Cash flow analysis reveals negative operating and free cash flow, indicating that the company is not generating sufficient cash from its operations. Although there is some growth in cash position due to financing activities, the reliance on external funding poses a risk to sustainability. The lack of free cash flow growth further highlights potential liquidity concerns.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue0.000.000.000.000.00
Gross Profit-29.83K-36.96K-38.09K-37.35K-36.85K
EBITDA-3.48M-3.95M-5.84M-5.48M-3.19M
Net Income-8.25M522.04K-17.99M-5.58M-14.78M
Balance Sheet
Total Assets63.00M59.06M52.53M46.54M42.81M
Cash, Cash Equivalents and Short-Term Investments7.30M4.35M7.42M7.06M12.80M
Total Debt0.0022.94K82.60K151.84K113.55K
Total Liabilities782.85K186.15K909.01K812.30K695.91K
Stockholders Equity62.22M58.88M51.62M45.73M42.12M
Cash Flow
Free Cash Flow-3.67M-3.09M-13.41M-14.07M-11.21M
Operating Cash Flow-3.30M-2.05M-5.14M-5.24M-2.16M
Investing Cash Flow-211.76K-8.21M-8.77M-8.99M
Financing Cash Flow6.42M27.88K13.74M8.14M18.64M

Erdene Resources Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price0.88
Price Trends
50DMA
0.93
Negative
100DMA
0.84
Positive
200DMA
0.72
Positive
Market Momentum
MACD
-0.01
Positive
RSI
39.65
Neutral
STOCH
23.29
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ERD, the sentiment is Neutral. The current price of 0.88 is below the 20-day moving average (MA) of 0.96, below the 50-day MA of 0.93, and above the 200-day MA of 0.72, indicating a neutral trend. The MACD of -0.01 indicates Positive momentum. The RSI at 39.65 is Neutral, neither overbought nor oversold. The STOCH value of 23.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:ERD.

Erdene Resources Peers Comparison

Overall Rating
UnderperformOutperform
Sector (44)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
TSNGD
77
Outperform
$5.17B28.2814.62%23.61%
TSKNT
77
Outperform
C$3.61B14.3139.28%105.06%481.75%
TSBTO
76
Outperform
$6.38B-17.61%3.06%5.97%-1677.31%
TSMND
75
Outperform
C$448.70M5.6125.03%41.30%340.97%
TSERD
47
Neutral
C$321.86M-16.90%-1666.67%
TSSEA
46
Neutral
$1.94B-1.46%1.89%
44
Neutral
C$953.01M-6.70-13.31%2.79%17.55%-32.28%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:ERD
Erdene Resources
0.88
0.48
120.00%
TSE:SEA
Seabridge Gold
19.33
0.65
3.48%
TSE:NGD
New Gold
6.53
3.83
141.85%
TSE:BTO
B2Gold
4.83
1.29
36.52%
TSE:MND
Mandalay Resources
4.74
2.52
113.51%
TSE:KNT
K92 Mining
15.01
7.18
91.70%

Erdene Resources Corporate Events

Product-Related AnnouncementsBusiness Operations and Strategy
Erdene Reports 2024 Progress and Bayan Khundii Project Update
Positive
Mar 26, 2025

Erdene Resource Development Corp. has reported significant progress in 2024, highlighted by the advancement of the Bayan Khundii Gold Project, which is set to become Mongolia’s largest primary gold producer. With construction over 80% complete, the project is on track for first gold production in Q3 2025. The company has also achieved substantial exploration success, with high-grade results from drilling activities, indicating strong growth potential. Additionally, Erdene has focused on community development and local employment, implementing a Local Cooperation Agreement and training local residents for employment at the mine.

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.Date of analysis: Mar 27, 2025