Lithium Royalty Corp. (LIRC) AI Stock Analysis

• Market Cap: C$155.50M
• Dividend Yield: N/A
• Average Volume (3M): 7.97K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.63
• Revenue Growth: -42.78%
• EPS Growth: 39.43%
• Country: CA
• Employees: 8
• Sector: Basic Materials
• Sector Strength: 64
• Industry: Industrial Materials
• EPS (TTM): -0.02
• Shares Outstanding: 24,383,736
• 10 Day Avg. Volume: 2,203
• 30 Day Avg. Volume: 7,973
• PEG Ratio: -1.87
• Price to Book (P/B): 3.84
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -29.94
• Enterprise Value/Market Cap: 3.16
• Enterprise Value/Revenue: 31.47
• Enterprise Value/Gross Profit: 199.49
• Enterprise Value/Ebitda: -42.83
• 1Y Price Target: C$7.17
• Price Target Upside: 37.62% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

• Rating: 56 Neutral
• Price Target: ―

Lithium Royalty Corp.'s overall score reflects significant financial challenges with negative profitability and cash flow issues, despite a strong balance sheet. Technical indicators show stable short-term momentum but a longer-term downtrend. The negative P/E ratio and lack of dividend yield detract from its valuation appeal. Positive corporate events, including resilient market performance and a share buyback initiative, contribute positively to the score.

Positive Factors

Financial Position

Lithium Royalty Corp. ended with a cash balance of $31.9 million and no debt, showing a substantial increase from the previous quarter.

Growth Opportunities

With a stronger balance sheet, Lithium Royalty Corp. is well-positioned to explore new royalty transactions, actively seeking opportunities for growth.

Project Developments

Sigma Lithium's Grota do Cirilo project is advancing toward Phase 2 completion, expected to produce significant spodumene concentrate.

Negative Factors

Earnings

Fourth quarter adjusted EBITDA remained negative at $(1.1) million, reflecting general and administrative expenses exceeding revenue.

Operational Challenges

Operations have wound down at Mt Cattlin and shut down at Finniss, affecting Lithium Royalty Corp.'s growth prospects.

Lithium Royalty Corp. Business Overview & Revenue Model

Company Description

Lithium Royalty Corp. operates as a lithium-focused royalty company. The company has diversified portfolio of royalties on mineral properties worldwide. Its royalty portfolio consists of 30 royalties on 28 properties, including 2 properties in production, 4 properties in construction, and 22 properties in development or exploration. The company was incorporated in 2017 and is based in Toronto, Canada.

How the Company Makes Money

Lithium Royalty Corp. generates revenue through the acquisition of royalty interests in lithium projects worldwide. By investing in these projects, LIRC is entitled to a percentage of the revenue generated from the production and sale of lithium extracted from the mines where it holds royalty agreements. This model allows the company to earn passive income without directly involving itself in the operational aspects of mining. Additionally, LIRC may benefit from strategic partnerships with mining companies, enhancing its portfolio and maximizing returns through diversified royalty streams. The company's earnings are influenced by global demand for lithium, market prices, and the successful development and operation of the lithium projects in which it has invested.

Lithium Royalty Corp. Financial Statement Overview

Summary

Lithium Royalty Corp. faces financial challenges primarily due to negative profitability and cash flow issues. While the balance sheet shows strength with low leverage and high equity, the income statement and cash flow statement indicate that the company needs to improve its profitability and cash management to enhance overall financial health.

Income Statement

Lithium Royalty Corp. exhibits a challenging financial performance with negative net income and EBIT margins over recent periods. The net profit margin for TTM (Trailing-Twelve-Months) is negative at -84.77%, indicating profitability concerns. Revenue has declined significantly from the previous year, showing a -45.26% growth rate. However, the company maintains a relatively high gross profit margin, suggesting some operational efficiency.

Balance Sheet

The balance sheet is relatively strong with a low debt-to-equity ratio of 0.003, reflecting sound leverage management. The equity ratio remains high at 95.92%, indicating financial stability. Return on equity is negative, which is a concern, but overall, the company maintains strong equity positioning.

Cash Flow

Cash flow metrics indicate potential liquidity issues, with negative free cash flow and operating cash flow. The operating cash flow to net income ratio is concerning due to negative operating cash flow. The company needs to address its cash management strategies to ensure better cash flow sustainability.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
3.02M	3.02M	5.52M	1.68M	1.80M	1.12M
	Gross Profit
2.46M	2.44M	4.59M	722.48K	767.00K	372.92K
	EBITDA
-3.33M	-3.43M	-3.60M	-2.27M	784.45K	350.20K
	Net Income
-2.56M	-2.73M	-5.04M	13.78M	10.72M	274.69K
Balance Sheet		Total Assets
151.05M	153.37M	155.03M	150.32M	101.18M	34.80M
	Cash, Cash Equivalents and Short-Term Investments
31.94M	6.73M	11.76M	35.88M	15.02M	5.30M
	Total Debt
424.00K	430.00K	0.00	0.00	0.00	0.00
	Total Liabilities
2.94M	4.55M	5.01M	9.77M	1.42M	201.75K
	Stockholders Equity
144.89M	145.61M	146.84M	137.44M	97.75M	33.04M
Cash Flow		Free Cash Flow
-4.57M	-4.42M	-61.22M	-17.62M	-27.75M	59.38K
	Operating Cash Flow
-1.13M	-615.00K	-7.54M	-2.12M	779.45K	59.38K
	Investing Cash Flow
24.34M	-3.80M	-53.61M	3.17M	-44.19M	0.00
	Financing Cash Flow
-556.00K	-540.00K	35.83M	20.92M	53.41M	-80.02K

Lithium Royalty Corp. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 5.21
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:LIRC, the sentiment is Negative. The current price of 5.21 is below the 20-day moving average (MA) of 5.25, below the 50-day MA of 5.24, and below the 200-day MA of 5.45, indicating a bearish trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 48.23 is Neutral, neither overbought nor oversold. The STOCH value of 3.03 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:LIRC.

Lithium Royalty Corp. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LIRC	56 Neutral	C$155.50M	―	-1.75%	―	-42.78%	39.43%
Sector *	44 Neutral	AU$1.36B	-6.09	-40.62%	4.29%	-4.78%	-43.21%
GQ	29 Underperform	C$4.17M	―	-599.35%	―	―	-250.68%
LXENF		$1.75M	―	-400.75%	―	―	―
OWRDF		$4.66M	―		―	―	―
WALRF		$542.86K	―	-84.55%	―	―	―
AWLI	33 Underperform	C$2.06M	―	-78.60%	―	―	-39.87%

Lithium Royalty Corp. Corporate Events

Lithium Royalty Corp. Adjusts Share Repurchase Offer

Lithium Royalty Corp. has announced an amendment to its substantial issuer bid, increasing the price range for share repurchase to between C$5.20 and C$5.70 per share, up from the original range of C$4.50 to C$5.20. This adjustment represents a premium to the recent average share price and extends the offer’s expiration to May 15, 2025. The move is aimed at repurchasing up to C$7,000,000 of its common shares, approximately 2.21% to 2.42% of its total equity shares, depending on the final purchase price. Shareholders must retender their shares under the new terms to participate, and the company plans to announce the offer results shortly after the expiration date.

Spark’s Take on TSE:LIRC Stock

According to Spark, TipRanks’ AI Analyst, TSE:LIRC is a Neutral.

Lithium Royalty Corp. faces substantial financial challenges with declining revenue and persistent losses, impacting its profitability. However, the company’s strong equity position and recent share buyback initiative demonstrate some financial stability and confidence in future prospects. Technical indicators suggest a stable short-term momentum but a longer-term downtrend. The negative P/E ratio reflects current profitability issues, and the absence of a dividend yield further impacts its valuation appeal.

To see Spark’s full report on TSE:LIRC stock, click here.

Lithium Royalty Corp. Reports Resilient Q1 2025 Results Amid Market Challenges

Lithium Royalty Corp. reported its first-quarter 2025 results, highlighting stable royalty revenue despite a 17% decline in spodumene prices, showcasing resilience against market fluctuations. The company maintains a strong balance sheet with $31.9 million in cash and no debt, positioning itself to seize growth opportunities as the lithium market recalibrates. Key developments include the inauguration of the Mariana lithium project in Argentina and anticipated production from the Tres Quebradas and Grota do Cirilo projects, which are expected to enhance cash flow and support long-term growth.

Spark’s Take on TSE:LIRC Stock

According to Spark, TipRanks’ AI Analyst, TSE:LIRC is a Neutral.

Lithium Royalty Corp. faces substantial financial challenges with declining revenue and persistent losses, impacting its profitability. However, the company’s strong equity position and recent share buyback initiative demonstrate some financial stability and confidence in future prospects. Technical indicators suggest a stable short-term momentum but a longer-term downtrend. The negative P/E ratio reflects current profitability issues, and the absence of a dividend yield further impacts its valuation appeal.

To see Spark’s full report on TSE:LIRC stock, click here.

Lithium Royalty Corp. Initiates C$7 Million Share Buyback

Lithium Royalty Corp. has announced a substantial issuer bid to repurchase up to C$7 million of its common shares through a modified Dutch auction, with prices ranging from C$4.50 to C$5.20 per share. This move is part of the company’s strategy to optimize its capital structure, utilizing available cash reserves bolstered by a recent partial sale of its Tres Quebradas royalty interest. The repurchase is expected to impact approximately 2.4% to 2.8% of the company’s total equity shares, potentially enhancing shareholder value and demonstrating confidence in the company’s financial health.

Lithium Royalty Corp. Reports 81% Growth in LCEts Amid Revenue Decline

Lithium Royalty Corp. reported an 81% increase in Lithium Carbonate Equivalent Tonnes (LCEts) for 2024, driven by significant volume growth and a diversified royalty portfolio. Despite a 45% decline in annual royalty revenue due to lower lithium prices, the company remains optimistic about future growth with the inauguration of Ganfeng Lithium’s Mariana project and upcoming asset start-ups. The partial sale of royalty over the Tres Quebradas Project is expected to bolster the company’s balance sheet amid cyclical market lows.