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Torex Gold Resources (TORXF)
OTHER OTC:TORXF
Top Page
Positive Factors
Earnings
Torex's Q1 earnings were ahead of expectations, with EPS of $0.42 beating estimates.
Management
A quality management team with a track record of delivery is seen as a positive factor for the company.
Operational Efficiency
Gold recovery of 90.4% exceeded the forecast, highlighting the company's operational efficiency and potential for increased profitability.
Negative Factors
Capital Return Timing
First production from Media Luna was reiterated by end of March, and with FCF expected to turn substantially positive in mid-2025, Torex intends to formalize a capital return program mid-year.
Production Challenges
Despite challenges, Torex's Q1 production of 59.6koz AuEq was in line with estimates, indicating a strong start for the year.
Torex Gold Resources (TORXF) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.92B
Dividend YieldN/A
Average Volume (3M)28.52K
Price to Earnings (P/E)22.3
Beta (1Y)0.59
Revenue GrowthN/A
EPS GrowthN/A
CountryUS
Employees883
SectorBasic Materials
Sector Strength62
IndustryGold
Share Statistics
EPS (TTM)0.41
Shares Outstanding86,205,444
10 Day Avg. Volume29,352
30 Day Avg. Volume28,525
Financial Highlights & Ratios
PEG Ratio-5.72
Price to Book (P/B)1.52
Price to Sales (P/S)0.00
P/FCF Ratio-12.77
Enterprise Value/Market Cap0.93
Enterprise Value/Revenue0.64
Enterprise Value/Gross Profit5.84
Enterprise Value/Ebitda1.31
Forecast
1Y Price Target
$42.08Price Target Upside24.46% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering7
Torex Gold Resources Business Overview & Revenue Model
Company DescriptionTorex Gold Resources Inc. operates as an intermediate gold producer in Mexico. It primarily holds a 100% interest in the Morelos Gold property that covers an area of 29,000 hectares located southwest of Mexico City. The company's principal assets include the El Limón Guajes mining complex comprising the El Limón Guajes open pits, the El Limón Guajes underground mine, and the processing plant and related infrastructure, and the Media Luna deposit, which is an advanced stage development project. It also mines for silver, copper, and carbon deposits. The company was formerly known as Gleichen Resources Ltd. and changed its name to Torex Gold Resources Inc. in April 2010. Torex Gold Resources Inc. was incorporated in 1980 and is headquartered in Toronto, Canada.
How the Company Makes Money
Torex Gold Resources Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: 2.45%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Neutral
The earnings call reflected significant achievements, including achieving commercial production at Media Luna and successful workforce transitions. However, these were balanced by higher costs expected in Q2 and a substantial debt drawdown. Overall, the sentiment is hopeful for improved performance in the latter half of 2025 as production stabilizes and costs decline.Q1-2025 Updates
Positive Updates
Commercial Production Achieved at Media Luna
Torex Gold achieved commercial production at Media Luna on schedule with construction substantially complete and mining and mill throughput exceeding required thresholds.
Successful Workforce Transition
Successfully transitioned or recruited nearly 500 employees for Media Luna operations, maintaining a high level of local community recruitment.
7% Reserve Growth
Achieved a 7% year-over-year growth in mineral reserves, primarily due to EPO inclusion and ELG Underground depletion replacement.
Safety Program Enhancement
Launched a next-level safety program to re-establish Torex Gold as an industry leader in safety after a carbon monoxide incident.
Strong Liquidity Position
Ended the quarter with nearly $200 million in available liquidity and $107 million in cash.
Negative Updates
Higher Costs Due to Commissioning Phase
Higher costs from Media Luna's commissioning phase are expected to impact Q2, with all-in sustaining costs peaking above the upper guidance range.
Debt Drawdown
The company drew down $113 million on its debt facility due to lower production, Media Luna spending, and significant tax outflows.
Lower Production and Ore Grade
Q1 production was lower due to a four-week processing plant tie-in period, and ore grades were lower as open pits wind down.
Company Guidance
During the Torex Gold Q1 2025 conference call, the company provided detailed guidance on various financial and operational metrics. The call highlighted the completion of major milestones, including the conclusion of construction and the commencement of commercial production at the Media Luna project on April 26th. Torex's all-in sustaining costs were reported at $1,405 per ounce for the first quarter, with expectations for costs to peak in Q2 due to the sales of higher-cost production from the commissioning phase. The company ended Q1 with $107 million in cash and drew $113 million on its credit facility to manage high tax and royalty payments during the quarter. Torex anticipates an increase in production levels through Q2 as Media Luna ramps up, with production stabilizing in Q3. The company expects to return to positive free cash flow by mid-2025 and plans to outline a return of capital policy to shareholders later this year. Additionally, Torex reported a 7% year-over-year growth in mineral reserves and is planning a significant increase in exploration activities with a budget of $45 million for 2025.Torex Gold Resources Financial Statement Overview
Summary
Torex Gold showcases strong profitability with a gross profit margin of 44% and an EBIT margin of 42% TTM, though revenue has seen a modest decline. The balance sheet is robust, featuring a low debt-to-equity ratio of 0.17 and an equity ratio of 75.6%, although ROE is moderate at 7.79%. Cash flow management is a concern due to negative free cash flow impacted by high capital expenditures, despite efficient profit-to-cash conversion.Income Statement
The company demonstrates strong profitability with a consistent gross profit margin around 44% and a robust EBIT margin of 42% TTM (Trailing-Twelve-Months). Revenue growth has been modest, with a decline of 5.95% in the most recent annual period, but overall growth from 2020 to 2024 is evident. Net profit margin in the TTM period is 12.44%, indicating stable profitability despite slight fluctuations.75
Positive
Balance Sheet
The balance sheet is solid with a low debt-to-equity ratio of 0.17 TTM, showing conservative leverage. The company maintains a healthy equity ratio of 75.6%, reflecting strong asset coverage by equity. Return on equity is lower at 7.79% TTM, suggesting room for improvement in generating returns from shareholders' equity.80
Positive
Cash Flow
Operating cash flow to net income ratio is strong at 2.76 TTM, indicating efficient conversion of profits to cash. However, free cash flow is negative at -$199.1M TTM, impacted by high capital expenditures, posing a risk to liquidity. Free cash flow to net income ratio is also negative, highlighting the need for better cash management.65
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 1.05B | 1.12B | 882.60M | 868.50M | 855.80M | 789.20M | Gross Profit |
| 465.00M | 468.20M | 484.60M | 303.90M | 326.50M | 257.20M | EBIT |
| 441.50M | 407.20M | 453.10M | 276.50M | 298.50M | 218.10M | EBITDA |
| 511.30M | 542.70M | 432.80M | 488.10M | 460.20M | 399.30M | Net Income Common Stockholders |
| 130.50M | 134.60M | 204.40M | 188.80M | 151.70M | 109.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 106.50M | 110.20M | 172.80M | 376.00M | 255.70M | 206.20M | Total Assets |
| 2.22B | 2.14B | 1.84B | 1.59B | 1.36B | 1.25B | Total Debt |
| 279.60M | 141.20M | 32.00M | 3.90M | 3.30M | 43.40M | Net Debt |
| 173.10M | 31.00M | -140.80M | -372.10M | -252.40M | -130.70M | Total Liabilities |
| 541.20M | 508.90M | 340.70M | 303.20M | 258.50M | 306.30M | Stockholders Equity |
| 1.67B | 1.63B | 1.50B | 1.29B | 1.10B | 946.10M |
| Cash Flow | Free Cash Flow | ||||
| -199.10M | -112.20M | -178.70M | 130.50M | 99.50M | 199.70M | Operating Cash Flow |
| 359.80M | 449.50M | 300.80M | 408.10M | 330.00M | 342.10M | Investing Cash Flow |
| -542.00M | -562.70M | -498.30M | -280.50M | -203.70M | -177.60M | Financing Cash Flow |
| 178.70M | 53.60M | -7.90M | -7.70M | -44.90M | -150.00M |
Torex Gold Resources Peers Comparison
Overall Rating
UnderperformOutperform
Sector (51)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
| $2.92B | 22.29 | 8.12% | ― | ― | ― | ||
51 Neutral | $2.02B | -1.14 | -21.37% | 3.64% | 2.88% | -30.57% | |
| $2.58B | 32.06 | 2.71% | 0.76% | ― | ― | ||
| $3.34B | 11.49 | 16.21% | 0.62% | ― | ― | ||
79 Outperform | C$3.58B | 12.06 | 19.71% | 1.06% | 10.57% | 24.23% | |
76 Outperform | C$4.94B | 40.45 | -0.28% | ― | 72.95% | 97.10% | |
| $3.17B | 11.19 | 8.27% | ― | ― | ― |
* Basic Materials Sector Average
Performance Comparison
TORXF
Torex Gold Resources
33.81
18.16
116.04%
SSRM
SSR Mining
12.79
7.65
148.83%
OCANF
OceanaGold
4.83
2.61
117.57%
TSE:DPM
Dundee Precious Mtl
21.21
10.48
97.67%
TSE:OLA
Orla Mining
14.80
9.28
168.12%
EQX
Equinox Gold
6.93
1.67
31.75%
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.