Royalty North (HCU) AI Stock Analysis

• Market Cap: C$75.10M
• Dividend Yield: N/A
• Average Volume (3M): 17.48K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.21
• Revenue Growth: 148.24%
• EPS Growth: -70.27%
• Country: CA
• Employees: 2
• Sector: Real Estate
• Sector Strength: 67
• Industry: Copper
• EPS (TTM): -0.28
• Shares Outstanding: 64,740,200
• 10 Day Avg. Volume: 19,597
• 30 Day Avg. Volume: 17,477
• PEG Ratio: 0.82
• Price to Book (P/B): -1.07
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 4.40
• Enterprise Value/Market Cap: 3.24
• Enterprise Value/Revenue: 4.78
• Enterprise Value/Gross Profit: 35.64
• Enterprise Value/Ebitda: -1.92
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

The overall score of 48 reflects the company's significant financial challenges, including high leverage and negative net income. While recent corporate events highlight promising project advancements, these are not yet reflected in the financials. Technical analysis shows mixed signals, with the potential for continued volatility. Valuation metrics suggest the stock might be overvalued given the current financial state. Overall, the stock's performance is hindered by financial instability, with potential future improvements dependent on successful project outcomes.

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

Royalty North is facing significant financial challenges, with negative net income and cash flow issues despite some revenue growth. The balance sheet shows high leverage, with liabilities exceeding assets, leading to negative equity. The income statement and cash flow suggest operational difficulties and financial instability. Overall, the company's financial health is weak, with potential risks due to high leverage and ongoing losses.

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
	EBIT
5.21M	3.42M	-2.21M	-2.54M	2.70M	39.20K
	EBITDA
-35.34M	-37.85M	-10.42M	-2.54M	2.81M	―
	Net Income Common Stockholders
-57.97M	-57.18M	-23.68M	-15.82M	2.81M	―
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
33.10M	12.22M	18.27M	32.70M	3.60M	40.00K
	Total Assets
300.03M	513.41M	520.25M	300.71M	9.04M	6.47M
	Total Debt
70.79M	191.64M	187.74M	71.16M	0.00	240.00K
	Net Debt
37.69M	179.42M	169.48M	38.47M	-3.60M	200.00K
	Total Liabilities
276.87M	564.69M	514.87M	273.52M	96.00K	314.00K
	Stockholders Equity
23.16M	-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: 1.16
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

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 1.16 is above the 20-day moving average (MA) of 1.12, above the 50-day MA of 1.13, and above the 200-day MA of 0.99, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 52.52 is Neutral, neither overbought nor oversold. The STOCH value of 64.10 is Neutral, 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 *	60 Neutral	$2.81B	10.29	0.39%	8508.26%	5.90%	-17.41%
HCU	48 Neutral	C$75.10M	―	178.91%	―	148.24%	-70.27%
ECU	42 Neutral	C$61.47M	―	-49.94%	―	―	-217.22%
CCI	42 Neutral	C$16.00M	―	-38.29%	―	―	-50.88%
HI	34 Underperform	C$73.64M	―	-30.45%	―	―	-159.13%

Royalty North Corporate Events

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.

Spark’s Take on TSE:HCU Stock

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

The overall score of 48 reflects the company’s significant financial challenges, including high leverage and negative net income. Despite recent price movements and project advancements, the stock displays technical and valuation concerns. The potential for future project success is promising but not yet realized in the financials or current stock performance.

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

Horizon Copper Advances Hod Maden Project and Reports New Drilling Results

Horizon Copper Corp., a company with a 30% non-operating interest in the Hod Maden copper-gold development project in Türkiye, is advancing its investment in the project alongside its interests in the Hugo North Extension and Heruga deposit of the Oyu Tolgoi copper mine through its equity ownership in Entrée Resources Ltd. The company announced that SSR Mining Inc., the operator of Hod Maden, plans a capital expenditure of $60–$100 million in 2025 for early-works construction, focusing on critical path items and exploration. This investment is expected to move the project closer to a formal investment decision and first production by 2028. Additionally, Entrée Resources released promising new assay results from drilling at the Hugo North Extension and Heruga deposit, indicating significant copper and gold mineralization.