TSX:DGC

Stock Analysis Report

Executive Summary

Detour Gold Corporation, a gold mining company, engages in the acquisition, exploration, development, and operation of mineral properties in Canada.

Rewards

Trading at 14.7% below its fair value

Earnings are forecast to grow 29.98% per year

Risk Analysis

Large one-off items impacting financial results

Profit margins (1.2%) are lower than last year (6.3%)



Snowflake Analysis

Excellent balance sheet with moderate growth potential.


Similar Companies

Share Price & News

How has Detour Gold's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: DGC has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-0.5%

DGC

1.8%

CA Metals and Mining

-0.2%

CA Market


1 Year Return

98.4%

DGC

26.3%

CA Metals and Mining

9.4%

CA Market

Return vs Industry: DGC exceeded the Canadian Metals and Mining industry which returned 26.9% over the past year.

Return vs Market: DGC exceeded the Canadian Market which returned 10.4% over the past year.


Shareholder returns

DGCIndustryMarket
7 Day-0.5%1.8%-0.2%
30 Day-1.1%0.9%1.8%
90 Day24.5%10.1%6.3%
1 Year98.4%98.4%27.2%26.3%12.9%9.4%
3 Year45.9%45.9%0.7%-1.2%17.1%6.5%
5 Year88.5%88.5%28.1%23.9%37.3%17.2%

Price Volatility Vs. Market

How volatile is Detour Gold's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Detour Gold undervalued compared to its fair value and its price relative to the market?

18.8%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: DGC (CA$25.06) is trading below our estimate of fair value (CA$29.39)

Significantly Below Fair Value: DGC is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: DGC is poor value based on its PE Ratio (344.1x) compared to the Metals and Mining industry average (17.3x).

PE vs Market: DGC is poor value based on its PE Ratio (344.1x) compared to the Canadian market (15.8x).


Price to Earnings Growth Ratio

PEG Ratio: DGC is poor value based on its PEG Ratio (11.5x)


Price to Book Ratio

PB vs Industry: DGC is overvalued based on its PB Ratio (1.7x) compared to the CA Metals and Mining industry average (1.5x).


Next Steps

Future Growth

How is Detour Gold forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

28.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: DGC's forecast earnings growth (30% per year) is above the savings rate (1.4%).

Earnings vs Market: DGC's earnings (30% per year) are forecast to grow faster than the Canadian market (10.3% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: DGC's revenue (3.1% per year) is forecast to grow slower than the Canadian market (5% per year).

High Growth Revenue: DGC's revenue (3.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: DGC's Return on Equity is forecast to be low in 3 years time (7.2%).


Next Steps

Past Performance

How has Detour Gold performed over the past 5 years?

64.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: DGC has a large one-off loss of $27.0M impacting its September 30 2019 financial results.

Growing Profit Margin: DGC's current net profit margins (1.2%) are lower than last year (6.3%).


Past Earnings Growth Analysis

Earnings Trend: DGC has become profitable over the past 5 years, growing earnings by 64.3% per year.

Accelerating Growth: DGC's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: DGC had negative earnings growth (-79.4%) over the past year, making it difficult to compare to the Metals and Mining industry average (-1.4%).


Return on Equity

High ROE: DGC's Return on Equity (0.5%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Detour Gold's financial position?


Financial Position Analysis

Short Term Liabilities: DGC's short term assets ($269.2M) exceed its short term liabilities ($130.5M).

Long Term Liabilities: DGC's short term assets ($269.2M) do not cover its long term liabilities ($413.2M).


Debt to Equity History and Analysis

Debt Level: DGC's debt to equity ratio (4.9%) is considered satisfactory.

Reducing Debt: DGC's debt to equity ratio has reduced from 22.6% to 4.9% over the past 5 years.

Debt Coverage: DGC's debt is well covered by operating cash flow (336.1%).

Interest Coverage: DGC's interest payments on its debt are well covered by EBIT (12.7x coverage).


Balance Sheet

Inventory Level: DGC has a high level of physical assets or inventory.

Debt Coverage by Assets: DGC's debt is covered by short term assets (assets are 2.7x debt).


Next Steps

Dividend

What is Detour Gold's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.9%markettop25%5.5%industryaverage1.1%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate DGC's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate DGC's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if DGC's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if DGC's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of DGC's dividend in 3 years as they are not forecast to pay a notable one for the Canadian market.


Next Steps

Management

What is the CEO of Detour Gold's salary, the management and board of directors tenure and is there insider trading?

0.8yrs

Average management tenure


CEO

Mick McMullen (49yo)

0.7yrs

Tenure

0

Mr. Michael James W. McMullen, also known as Mick, B.Sc., M.A., has been Chief Executive Officer, President and Director of Detour Gold Corporation since May 1, 2019. He was the Chief Executive Officer and ...


Management Age and Tenure

0.8yrs

Average Tenure

Experienced Management: DGC's management team is not considered experienced ( 0.8 years average tenure), which suggests a new team.


Board Age and Tenure

1.1yrs

Average Tenure

61yo

Average Age

Experienced Board: DGC's board of directors are not considered experienced ( 1.1 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyCA$189,87418 Jun 19
Patrice Merrin
EntityIndividual
Role
Chairman of the Board
Chairman of the Board
Shares13,000
Max PriceCA$14.61
BuyCA$74,56628 May 19
Michael James McMullen
EntityIndividual
Role
Chief Executive Officer
President
Shares6,300
Max PriceCA$11.84
BuyCA$6,57824 May 19
Dawn Whittaker
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares550
Max PriceCA$11.96
BuyCA$174,42113 May 19
Michael James McMullen
EntityIndividual
Role
Chief Executive Officer
President
Shares14,700
Max PriceCA$11.89
BuyCA$194,47319 Mar 19
Steven Feldman
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares15,000
Max PriceCA$12.96
SellCA$864,25014 Mar 19
James Mavor
EntityIndividual
Shares65,000
Max PriceCA$13.40
BuyCA$31,82311 Mar 19
William Williams
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares2,500
Max PriceCA$12.73
BuyCA$31,85011 Mar 19
Dawn Whittaker
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares2,500
Max PriceCA$12.74

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Mick McMullen (49yo)

    President

    • Tenure: 0.7yrs
  • Carl DeLuca

    General Counsel & Corporate Secretary

    • Tenure: 0.9yrs
  • Kelly Barrowcliffe

    Vice President of Human Resources

    • Tenure: 1.3yrs
  • Sheila Magallon

    Corporate Controller

    • Jaco Crouse

      Chief Financial Officer

      • Tenure: 0.6yrs

    Board Members

    • André Falzon (64yo)

      Independent Director

      • Tenure: 6.8yrs
      • Compensation: US$251.36k
    • Mick McMullen (49yo)

      President

      • Tenure: 0.7yrs
    • Steve Feldman (56yo)

      Independent Director

      • Tenure: 1.1yrs
      • Compensation: US$181.10k
    • Bill Williams (61yo)

      Independent Director

      • Tenure: 1.1yrs
      • Compensation: US$181.93k
    • Patrice Merrin (70yo)

      Chairman of the Board

      • Tenure: 0.6yrs
    • Chris Robison (61yo)

      Independent Director

      • Tenure: 1.1yrs
      • Compensation: US$181.51k
    • Judy Kirk (62yo)

      Independent Director

      • Tenure: 1.4yrs
      • Compensation: US$255.58k
    • Dawn Whittaker (57yo)

      Independent Director

      • Tenure: 1.1yrs
      • Compensation: US$181.51k
    • Ronald Simkus (66yo)

      Independent Director

      • Tenure: 1.1yrs
      • Compensation: US$181.10k

    Company Information

    Detour Gold Corporation's company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Detour Gold Corporation
    • Ticker: DGC
    • Exchange: TSX
    • Founded: 2006
    • Industry: Gold
    • Sector: Materials
    • Market Cap: CA$4.354b
    • Shares outstanding: 177.73m
    • Website: https://www.detourgold.com

    Number of Employees


    Location

    • Detour Gold Corporation
    • Commerce Court West
    • 199 Bay Street
    • Toronto
    • Ontario
    • M5L 1E2
    • Canada

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    DGCTSX (The Toronto Stock Exchange)YesCommon SharesCACADJan 2007
    D8MDB (Deutsche Boerse AG)YesCommon SharesDEEURJan 2007
    DRGD.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDJan 2007
    DGCSWX (SIX Swiss Exchange)YesCommon SharesCHCHFJan 2007

    Biography

    Detour Gold Corporation, a gold mining company, engages in the acquisition, exploration, development, and operation of mineral properties in Canada. It primarily explores for gold. The company’s primary asset is the Detour Lake property consisting of a contiguous block of mining claims and leases totaling 646 square kilometers located in the District of Cochrane. Detour Gold Corporation was founded in 2006 and is headquartered in Toronto, Canada. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/26 00:25
    End of Day Share Price2020/01/24 00:00
    Earnings2019/09/30
    Annual Earnings2018/12/31


    Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.