OM:LUG

Stock Analysis Report

Executive Summary

Lundin Gold Inc. operates as a mining company in Canada.

Rewards

Trading at 37.1% below its fair value

Earnings are forecast to grow 47.2% per year

Risk Analysis

Has less than 1 year of cash runway

Highly volatile share price over past 3 months

Shareholders have been diluted in the past year



Snowflake Analysis

Moderate growth potential and slightly overvalued.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: LUG's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

12.1%

LUG

0.7%

SE Metals and Mining

2.5%

SE Market


1 Year Return

96.6%

LUG

-1.0%

SE Metals and Mining

21.8%

SE Market

Return vs Industry: LUG exceeded the Swedish Metals and Mining industry which returned -0.9% over the past year.

Return vs Market: LUG exceeded the Swedish Market which returned 21.8% over the past year.


Shareholder returns

LUGIndustryMarket
7 Day12.1%0.7%2.5%
30 Day25.0%-3.0%4.0%
90 Day47.3%-3.5%9.7%
1 Year96.6%96.6%2.6%-1.0%26.8%21.8%
3 Year102.5%102.5%-5.4%-12.8%38.0%17.1%
5 Year204.2%204.2%15.8%2.1%46.9%15.5%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

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

37.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: LUG (SEK80.6) is trading below our estimate of fair value (SEK128.17)

Significantly Below Fair Value: LUG is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: LUG is unprofitable, so we can't compare its PE Ratio to the Metals and Mining industry average.

PE vs Market: LUG is unprofitable, so we can't compare its PE Ratio to the Swedish market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate LUG's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: LUG is overvalued based on its PB Ratio (3.7x) compared to the SE Metals and Mining industry average (1.5x).


Next Steps

Future Growth

How is Lundin Gold forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

47.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LUG is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (-0.4%).

Earnings vs Market: LUG is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: LUG's is expected to become profitable in the next 3 years.

Revenue vs Market: Insufficient data to determine if LUG's revenue is forecast to grow faster than the Swedish market.

High Growth Revenue: Insufficient data to determine if LUG's revenue is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LUG's Return on Equity is forecast to be low in 3 years time (19.1%).


Next Steps

Past Performance

How has Lundin Gold performed over the past 5 years?

-18.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LUG is currently unprofitable.

Growing Profit Margin: LUG is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: LUG is unprofitable, and losses have increased over the past 5 years at a rate of -18.2% per year.

Accelerating Growth: Unable to compare LUG's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: LUG is unprofitable, making it difficult to compare its past year earnings growth to the Metals and Mining industry (-14.9%).


Return on Equity

High ROE: LUG has a negative Return on Equity (-19.53%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Lundin Gold's financial position?


Financial Position Analysis

Short Term Liabilities: LUG's short term assets ($171.3M) exceed its short term liabilities ($46.8M).

Long Term Liabilities: LUG's short term assets ($171.3M) do not cover its long term liabilities ($777.2M).


Debt to Equity History and Analysis

Debt Level: LUG's debt to equity ratio (148.4%) is considered high.

Reducing Debt: Insufficient data to determine if LUG's debt to equity ratio has reduced over the past 5 years.


Balance Sheet

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

Debt Coverage by Assets: LUG's debt is not covered by short term assets (assets are 0.2x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: LUG has less than a year of cash runway based on its current free cash flow.

Forecast Cash Runway: Insufficient data to determine if LUG has enough cash runway if its free cash flow continues to grow or shrink based on historical rates.


Next Steps

Dividend

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


Dividend Yield vs Market

companyn/amarketbottom25%1.6%markettop25%4.2%industryaverage3.5%forecastin3Years0%

Current dividend yield vs market & industry

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

High Dividend: Unable to evaluate LUG'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 LUG's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if LUG'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 LUG's dividend in 3 years as they are not forecast to pay a notable one for the Swedish market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

4.3yrs

Average management tenure


CEO

Ron Hochstein (57yo)

6.1yrs

Tenure

US$1,148,801

Compensation

Mr. Ronald F. Hochstein, also known as Ron, MBA, P.Eng., B.Sc. (Mineral Process Engineering), has been the Chief Executive Officer and President of Rockgate Capital Corp. since November 2013. He serves as  ...


CEO Compensation Analysis

Compensation vs Market: Ron's total compensation ($USD1.15M) is above average for companies of similar size in the Swedish market ($USD812.57K).

Compensation vs Earnings: Ron's compensation has increased whilst the company is unprofitable.


Leadership Team

NamePositionTenureCompensationOwnership
Ronald Hochstein
President6.1yrsUS$1.15m0.13% $24.1m
Alessandro Bitelli
Executive VP & CFO3.6yrsUS$799.51k0.0045% $844.4k
Iliana Rodriguez
Vice President of Human Resources3.4yrsUS$540.27kno data
Sabina Srubiski
Manager of Investor Relations0yrsno datano data
Sheila Colman
VP of Legal & Corporate Secretary5.1yrsno datano data

4.3yrs

Average Tenure

Experienced Management: LUG's management team is considered experienced (4.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Ronald Hochstein
President6.1yrsUS$1.15m0.13% $24.1m
Lukas Lundin
Non-Executive Chairman6.1yrsUS$116.35k0.22% $41.1m
Charles Ashley Heppenstall
Lead Director4.8yrsUS$133.71k0.067% $12.7m
Ian Gibbs
Independent Director11.8yrsUS$124.07k0.041% $7.8m
Chantal Gosselin
Independent Director2.9yrsUS$114.42k0.0053% $1.0m
Carmel Daniele
Independent Director5.1yrsUS$34.73kno data
Paul McRae
Independent Director5.2yrsUS$116.35k0.00061% $115.5k
Istvan Zollei
Director1.9yrsUS$93.71kno data
Craig Jones
Director1.7yrsUS$22.51kno data
Tamara Brown
Director0.5yrsno datano data

4.9yrs

Average Tenure

57yo

Average Age

Experienced Board: LUG's board of directors are considered experienced (4.9 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: LUG insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 30.2%.


Top Shareholders

Company Information

Lundin Gold Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Lundin Gold Inc.
  • Ticker: LUG
  • Exchange: OM
  • Founded: 1986
  • Industry: Gold
  • Sector: Materials
  • Market Cap: CA$2.583b
  • Listing Market Cap: CA$18.934b
  • Shares outstanding: 224.22m
  • Website: https://www.lundingold.com

Number of Employees


Location

  • Lundin Gold Inc.
  • 885 West Georgia Street
  • Suite 2000
  • Vancouver
  • British Columbia
  • V6C 3E8
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
LUGTSX (The Toronto Stock Exchange)YesCommon SharesCACADJan 1989
F1YNDB (Deutsche Boerse AG)YesCommon SharesDEEURJan 1989
FTMN.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDJan 1989
LUGOM (OMX Nordic Exchange Stockholm)YesCommon SharesSESEKJan 1989
0R4MLSE (London Stock Exchange)YesCommon SharesGBSEKJan 1989
LUGSBATS-CHIXE (BATS 'Chi-X Europe')YesCommon SharesGBSEKJan 1989

Biography

Lundin Gold Inc. operates as a mining company in Canada. The company holds interests in 30 mining concessions covering an area of approximately 64,406 hectares located in Southeast Ecuador. It primarily focuses on advancing the Fruta del Norte gold project that comprises 6 concessions covering an area of approximately 5,039 hectares located near the city of Loja in Ecuador. The company was formerly known as Fortress Minerals Corp. and changed its name to Lundin Gold Inc. in December 2014. Lundin Gold Inc. was incorporated in 1986 and is headquartered in Vancouver, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/15 23:18
End of Day Share Price2020/02/14 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.