By: Matt rego

Torex Gold Resources Inc. (OTC Pink: TORXF) saw shares jump 14% on heavier than normal volume. The gold company has seen 118,450 shares exchange hands or dollar volume of around $195,300. Torex Gold Resources Inc. (OTC Pink: TORXF) normally sees average daily volumes of around 218,970 over the past three months.

The jump in the stock price came after the gold company reported first quarter 2016 earnings. Here is an Analysis by Capital Cube detailing of the company’s earnings:

Torex Gold Resources, Inc. reports financial results for the quarter ended March 31, 2016.

Analysis

  • Summary numbers: Revenues of USD 0 million, Net Earnings of USD -37.83 million.
  • The company did not record any revenues for the last twelve months making the comparison of net margin versus asset turnover meaningless.
  • TORXF-US‘s earnings and EBITDA are both negative which suggest that P/E or Price/EBITDA are not meaningful to make this analysis between operating advantage (ROE) and growth expectations (as suggested by P/E or P/EBITDA).
  • Cash and Cash equivalents were down this period to 31.00 million compared to 103.43 million in the same period last year.
  • With debt at 25.92% of its enterprise value compared to an overall benchmark of 25% (Note: The peer median is currently 23.67%), and relatively tight interest coverage level of -18.71x, TORXF-US would have a hard time raising much additional debt.
  • All 4 peers for the company have an outstanding debt balance.
  • Net income of -37.83 million this period compared to a net income of 0.20 million last period. This is a growth of -19,110.55% over the previous period. In comparison, the peer group grew at -22.95%

Torex is an emerging intermediate gold producer based in Canada, engaged in the exploration, development and exploitation of its 100% owned Morelos Gold Property, an area of 29,000 hectares in the highly prospective Guerrero Gold Belt located 180 kilometers southwest of Mexico City. Within this property, Torex has the El Limon-Guajes (ELG) Mine, which started gold production in December of 2015, and the Media Luna Project, at an advanced stage of exploration, with a positive PEA completed in July of 2015. The property remains 75% unexplored.

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