Royalty North (HCU) AI Stock Analysis

• Market Cap: C$168.09M
• Dividend Yield: N/A
• Average Volume (3M): 194.33K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.43
• Revenue Growth: 148.24%
• EPS Growth: -70.27%
• Country: CA
• Employees: 2
• Sector: Real Estate
• Sector Strength: 56
• Industry: Copper
• EPS (TTM): -0.28
• Shares Outstanding: 86,643,105
• 10 Day Avg. Volume: 529,460
• 30 Day Avg. Volume: 194,330
• PEG Ratio: <0.01
• Price to Book (P/B): 0.56
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -88.18
• Enterprise Value/Market Cap: 0.02
• Enterprise Value/Revenue: 0.07
• Enterprise Value/Gross Profit: 0.50
• Enterprise Value/Ebitda: -0.03
• 1Y Price Target: C$1.00
• Price Target Upside: -48.45% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 53 Neutral
• Price Target: C$2.00 ▲(3.09%Upside)

The overall score reflects significant financial challenges and weak valuation, partially offset by positive corporate events and mixed technical signals. The acquisition at a premium and promising drill results are notable positives, but high leverage and negative profitability pose risks.

Royalty North Business Overview & Revenue Model

Company Description

Horizon Copper Corp., together with its subsidiaries, engages in the copper mining operations. The company has a 30% interest in the Hod Maden copper-gold project located in Turkey; and a 55% interest in the Peninsula gold project situated in Michigan on the southern edge of the Superior Province in Archean aged rocks of the Ishpeming Greenstone Belt. It holds a 20% interest in the Oyu Tolgoi copper project, which includes the Hugo North Extension and Heruga deposits located in the South Gobi Desert of Mongolia, as well as a 1.66% net profits interest in the Antamina copper mine located in Peru. The company is headquartered in Vancouver, Canada.

How the Company Makes Money

Royalty North makes money through its royalty financing model, where it provides businesses with capital in exchange for a percentage of future revenues or sales. This model allows Royalty North to earn a steady stream of income based on the performance of its client companies. Key revenue streams include royalties from healthcare, technology, and consumer goods companies. Significant partnerships with industry leaders and strategic alliances further enhance its earnings potential by expanding its client base and investment opportunities.

Royalty North Financial Statement Overview

Summary

The financial performance of Royalty North is concerning, with negative net income, a weak balance sheet characterized by negative equity, and limited cash flow growth. Despite some revenue growth, overall profitability is poor due to high leverage and ongoing losses, indicating financial instability.

Income Statement

Royalty North's income statement reveals significant challenges. The company's net income and EBITDA are negative, indicating operational struggles. Despite a revenue increase to $12.78M in 2024 from $4.05M in 2023, the net profit margin remains negative, highlighting ongoing profitability issues. The gross profit margin improved to 39.77% in 2024, but overall profitability is weak, with significant losses impacting the financial health.

Balance Sheet

The balance sheet shows a concerning financial position, with substantial liabilities outweighing assets, leading to negative stockholders' equity of -$51.28M in 2024. The debt-to-equity ratio is not meaningful due to negative equity, indicating high leverage and financial risk. The equity ratio is negative, further emphasizing the company's precarious position. This weak balance sheet reflects financial instability and potential solvency risks.

Cash Flow

Cash flow analysis indicates some resilience, with positive operating cash flow of $13.20M in 2024. However, free cash flow growth is stagnant, and the free cash flow to net income ratio is not calculable due to negative net income. The company's ability to generate cash from operations is a positive sign, but overall cash flow health is overshadowed by the negative net income and lack of growth in free cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	14.03M	12.78M	4.05M	-355.00K	2.96M	246.03K
Gross Profit	6.83M	5.08M	-482.00K	-397.00K	2.96M	246.03K
EBITDA	-35.34M	-37.85M	-10.42M	-2.54M	2.81M	―
Net Income	-57.97M	-57.18M	-23.68M	-15.82M	2.81M	―
Balance Sheet
Total Assets	512.51M	513.41M	520.25M	300.71M	9.04M	6.47M
Cash, Cash Equivalents and Short-Term Investments	6.00M	12.22M	18.27M	32.70M	3.60M	40.00K
Total Debt	192.19M	191.64M	187.74M	71.16M	0.00	240.00K
Total Liabilities	579.53M	564.69M	514.87M	273.52M	96.00K	314.00K
Stockholders Equity	-67.02M	-51.28M	5.38M	27.18M	8.95M	6.15M
Cash Flow
Free Cash Flow	12.97M	13.20M	3.96M	-172.00K	882.00K	666.43K
Operating Cash Flow	12.97M	13.20M	3.96M	-172.00K	882.00K	666.43K
Investing Cash Flow	-14.01M	-9.44M	-15.86M	14.02M	2.95M	0.00
Financing Cash Flow	-9.35M	-9.76M	-2.47M	15.93M	-247.00K	-718.71K

Royalty North Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.94
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:HCU, the sentiment is Positive. The current price of 1.94 is above the 20-day moving average (MA) of 1.25, above the 50-day MA of 1.19, and above the 200-day MA of 1.09, indicating a bullish trend. The MACD of 0.15 indicates Negative momentum. The RSI at 83.31 is Negative, neither overbought nor oversold. The STOCH value of 99.25 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:HCU.

Royalty North Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	61 Neutral	€3.19B	4.22	-3.86%	3.72%	-3.18%	17.24%
HCU	53 Neutral	C$168.09M	―	178.91%	―	148.24%	-70.27%
ECU	42 Neutral	C$64.73M	―	-52.23%	―	―	-217.22%
CCI	42 Neutral	C$17.46M	―	-48.32%	―	―	-50.88%
HI	34 Underperform	C$73.64M	―	-33.38%	―	―	-159.13%
QCCUF		$19.84M	―	-229.96%	―	―	―
VCUFF		$30.82M	―	-49.06%	―	―	―

Royalty North Corporate Events

Royal Gold Acquires Horizon Copper in Strategic Expansion

Royal Gold, Inc. has announced its acquisition of Horizon Copper Corp for C$2.00 per share, representing a significant premium to Horizon’s recent stock prices. This all-cash transaction, valued at approximately US$196 million, is part of Royal Gold’s strategic expansion, which also includes acquiring Sandstorm Gold Ltd. The deal offers Horizon shareholders immediate liquidity and a substantial premium, reflecting the underlying value of Horizon’s assets. The acquisition is expected to enhance Royal Gold’s portfolio with high-quality, long-life royalty and streaming interests, contributing to its global asset diversification and growth potential.

Horizon Copper Reports Promising Drill Results at Oyu Tolgoi

Horizon Copper Corp. announced impressive high-grade drill results from the Hugo North Extension at the Oyu Tolgoi mine in Mongolia, highlighting the long-term potential of the project. The results, released by Entrée Resources Ltd., include significant copper and gold mineralization, reinforcing the value of Horizon’s investment in Entrée and the potential for robust cash flows and shareholder value. The ongoing development at the Oyu Tolgoi mine, operated by Rio Tinto Group, remains on schedule, with underground production expected in 2027.