Steppe Gold (STGO) AI Stock Analysis

• Market Cap: $300.86M
• Dividend Yield: N/A
• Average Volume (3M): 332.26K
• Price to Earnings (P/E): 3.8
• Beta (1Y): 0.90
• Revenue Growth: 148.01%
• EPS Growth: N/A
• Country: CA
• Employees: 275
• Sector: Basic Materials
• Sector Strength: 70
• Industry: Gold
• EPS (TTM): N/A
• Shares Outstanding: 252,827,200
• 10 Day Avg. Volume: 190,905
• 30 Day Avg. Volume: 332,258
• PEG Ratio: -0.24
• Price to Book (P/B): 0.58
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 2.33
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 82 Outperform
• Price Target: C$1.50 ▲(26.05%Upside)

Steppe Gold's overall stock score is driven by a robust financial performance and strategic growth initiatives. The company is capitalizing on favorable gold prices and operational efficiencies, as indicated in recent corporate events. Technical analysis supports a positive trend, although the reliance on debt warrants careful monitoring. The company's undervaluation, reflected in a low P/E ratio, presents a compelling investment opportunity.

Steppe Gold Business Overview & Revenue Model

Company Description

Steppe Gold Ltd. acquires, explores for, develops, and operates precious metals in Mongolia. Its principal projects are the Altan Tsagaan Ovoo gold and silver project comprising one mining license covering an area of approximately 5,492.63 hectares located in the territory of Tsagaan Ovoo soum, Dornod province of Eastern Mongolia; and the Uudam Khundii property that covers an area of 14,397 hectares located in Ulaanbaatar, Bayankhongor Province. The company was incorporated in 2016 and is headquartered in Ulaanbaatar, Mongolia.

How the Company Makes Money

Steppe Gold primarily generates revenue through the extraction and sale of gold and silver from its ATO Gold Mine. The company employs open-pit mining techniques to extract ore, which is then processed to produce gold and silver doré bars. These bars are sold to international precious metal refiners and traders at market prices. Steppe Gold's revenue model is heavily reliant on the fluctuations in global gold and silver prices, as well as its production efficiency and output. Additionally, the company may engage in strategic partnerships and joint ventures to explore and develop additional mining opportunities, further contributing to its revenue streams.

Steppe Gold Financial Statement Overview

Summary

Steppe Gold presents a mixed financial picture. The company demonstrates strong revenue and cash flow growth, with operational efficiencies leading to solid EBIT and EBITDA margins. However, the negative net income and high leverage pose risks to financial stability and profitability. While the ability to generate cash flow is commendable, the reliance on debt and the negative ROE highlight areas needing strategic focus. Moving forward, addressing net profitability while managing leverage will be crucial for sustained financial health.

Income Statement

Steppe Gold's income statement shows a strong recovery in revenue, with a notable TTM increase to $70.37M from $54.24M in 2023. The gross profit margin is healthy at approximately 50.2%, demonstrating effective cost management. However, the net profit margin is negative at -6.26%, indicating challenges in achieving net profitability. EBIT and EBITDA margins are relatively strong at 30.74% and 39.84%, respectively, showing operational efficiency. The primary concern is the transition from a net income gain in 2023 to a loss in the TTM, which may suggest underlying cost or revenue challenges.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 1.52, which is significant within the mining industry and suggests high leverage. Despite this, the company has maintained a reasonable equity ratio of 31.15%, indicating a fair proportion of assets financed by equity. The return on equity (ROE) is negative due to the negative net income, highlighting inefficiencies in generating returns from shareholder equity. These factors point to a mixed stability, with potential risks due to high leverage.

Cash Flow

Steppe Gold's cash flow statement reflects strong free cash flow generation, growing significantly to $55.71M in TTM. The operating cash flow to net income ratio is robust, showcasing good cash generation relative to earnings. However, the free cash flow to net income ratio is negative due to net losses, indicating cash flow strength not translating into net profitability. The ability to generate operating cash flow is a positive sign, but sustainability amidst net income losses is a concern.

Breakdown	TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement
Total Revenue	70.37M	54.24M	62.37M	24.05M	52.10M	0.00
Gross Profit	35.31M	29.41M	30.82M	9.65M	28.45M	-169.54K
EBITDA	28.04M	23.08M	26.52M	3.68M	20.03M	-4.38M
Net Income	-4.40M	9.43M	15.96M	-22.68M	-4.05M	-6.53M
Balance Sheet
Total Assets	134.31M	98.29M	72.66M	146.28M	86.01M	53.44M
Cash, Cash Equivalents and Short-Term Investments	6.65M	6.01M	2.88M	4.07M	20.12M	671.42K
Total Debt	61.45M	36.05M	9.52M	81.50M	13.14M	4.76M
Total Liabilities	97.97M	50.29M	55.44M	139.26M	44.69M	42.37M
Stockholders Equity	36.95M	48.59M	17.72M	7.27M	41.53M	11.18M
Cash Flow
Free Cash Flow	55.71M	3.14M	12.79M	-15.95M	9.24M	-13.77M
Operating Cash Flow	69.92M	8.20M	18.71M	-7.04M	11.41M	-5.63M
Investing Cash Flow	-13.65M	-5.23M	-5.92M	-3.88M	-7.21M	-8.14M
Financing Cash Flow	-64.28M	592.00K	-13.19M	-1.47M	10.28M	7.62M

Steppe Gold Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.19
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:STGO, the sentiment is Positive. The current price of 1.19 is below the 20-day moving average (MA) of 1.32, above the 50-day MA of 1.09, and above the 200-day MA of 0.80, indicating a neutral trend. The MACD of 0.03 indicates Positive momentum. The RSI at 46.16 is Neutral, neither overbought nor oversold. The STOCH value of 15.29 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:STGO.

Steppe Gold Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
STGO	82 Outperform	$300.86M	3.84	44.39%	―	148.01%	―
Sector *	44 Neutral	C$979.74M	-6.70	-13.35%	2.68%	17.20%	-32.62%
GDRZF		$366.28M	―	-53.17%	―	―	―
THM		$183.30M	―	-6.29%	―	―	―
OMG	56 Neutral	C$380.48M	―	-64.22%	―	―	18.12%
TAU	55 Neutral	C$242.51M	53.85	-0.95%	―	―	12.63%
GLDG		$144.04M	―	-22.20%	―	―	―

Steppe Gold Corporate Events

Steppe Gold Announces AGM Voting Results and Board Changes

Steppe Gold Ltd. held its annual general and special meeting where shareholders elected seven individuals to the Board of Directors. However, nominee Byambats eren Tsogbadrak h received more votes withheld than in favor, prompting a required resignation submission. Additionally, Kingston Ross Pasnak LLP was re-appointed as the company’s auditors, while the proposed long-term incentive plan was not approved by shareholders.

Steppe Gold Reports Strong Q1 2025 Financial Results and Strategic Plans

Steppe Gold Ltd. reported strong financial results for Q1 2025, with total revenue of $32.4 million from gold sales and an adjusted EBITDA of $18.4 million. The company maintained a competitive all-in sustaining cost of $991 per ounce due to effective cost control. With higher gold prices anticipated in the latter half of 2025, Steppe Gold plans to restructure its debt and explore financing options for its Phase 2 Expansion. The company expects to exceed 70,000 ounces of gold production in 2025, supported by ongoing production at its Boroo Gold and ATO mine sites.