Westgold Resources (OTCPK:WTGR.F) - Share price, News & Analysis

Q: What is the Fair Price of WTGR.F when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

WTGR.F ($0.86) is trading below our estimate of [[fair value]] ($17.4)

WTGR.F fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	4/6
Past Performance	2/6
Financial Health	6/6
Dividends	2/6

WTGR.F Stock Overview

Westgold Resources Limited engages in the exploration, development, mining, and treatment of gold assets primarily in Western Australia.

Rewards

Trading at 95.1% below our estimate of its fair value

Earnings are forecast to grow 61.13% per year

Risk Analysis

Shares are highly illiquid

Dividend of 1.65% is not well covered by earnings

Profit margins (8.5%) are lower than last year (12.8%)

Shareholders have been diluted in the past year

Westgold Resources Competitors

DRDGOLD

NYSE:DRD

US$555.1m

Caledonia Mining

NYSEAM:CMCL

US$150.5m

Gold Resource

NYSEAM:GORO

US$156.4m

Fortitude Gold

OTCPK:FTCO

US$146.5m

Price History & Performance

Summary of all time highs, changes and price drops for Westgold Resources
Historical stock prices
Current Share Price	AU$0.86
52 Week High	AU$1.74
52 Week Low	AU$0.86
Beta	0.34
1 Month Change	-15.95%
3 Month Change	n/a
1 Year Change	-44.33%
3 Year Change	-16.77%
5 Year Change	-44.69%
Change since IPO	-44.69%

Shareholder Returns

	WTGR.F	US Metals and Mining	US Market
7D	-5.4%	-2.3%	6.3%
1Y	-44.3%	-7.9%	-18.8%

Return vs Industry: WTGR.F underperformed the US Metals and Mining industry which returned -9% over the past year.

Return vs Market: WTGR.F underperformed the US Market which returned -18.4% over the past year.

Price Volatility

Is WTGR.F's price volatile compared to industry and market?
WTGR.F volatility
WTGR.F Average Weekly Movement	n/a
Metals and Mining Industry Average Movement	9.9%
Market Average Movement	8.1%
10% most volatile stocks in US Market	16.7%
10% least volatile stocks in US Market	3.2%

Stable Share Price: Insufficient data to determine WTGR.F's volatility over the past 3 months.

Volatility Over Time: Insufficient data to determine WTGR.F's volatility change over the past year.

About the Company

Founded	Employees	CEO	Website
n/a	1,051	Wayne Bramwell	https://www.westgold.com.au

Westgold Resources Limited engages in the exploration, development, mining, and treatment of gold assets primarily in Western Australia. The company’s assets include the Meekatharra Gold Operations, Fortnum Gold Operations, and Cue Gold Operations that comprise approximately 350 mining titles covering an area of 1,300 square kilometers in the Central Murchison region. It also provides contract mining services.

Westgold Resources Fundamentals Summary

How do Westgold Resources's earnings and revenue compare to its market cap?
WTGR.F fundamental statistics
Market Cap	AU$575.30m
Earnings (TTM)	AU$49.14m
Revenue (TTM)	AU$580.38m

11.7x

P/E Ratio

1.0x

P/S Ratio

Is WTGR.F overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
WTGR.F income statement (TTM)
Revenue	AU$580.38m
Cost of Revenue	AU$505.69m
Gross Profit	AU$74.69m
Other Expenses	AU$25.56m
Earnings	AU$49.14m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	0.10
Gross Margin	12.87%
Net Profit Margin	8.47%
Debt/Equity Ratio	0%

How did WTGR.F perform over the long term?

See historical performance and comparison

Dividends

1.6%

Current Dividend Yield

17%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is WTGR.F undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for WTGR.F?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for WTGR.F. This is calculated by dividing WTGR.F's market cap by their current preferred multiple.
What is WTGR.F's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	AU$575.30m

WTGR.F key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.9x
Enterprise Value/EBITDA	1.9x
PEG Ratio	0.2x

Price to Earnings Ratio vs Peers

How does WTGR.F's PE Ratio compare to its peers?

WTGR.F PE Ratio vs Peers

The above table shows the PE ratio for WTGR.F vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	10.3x
DRD DRDGOLD	8.9x	-6.3%	US$555.1m
CMCL Caledonia Mining	7.8x	17.7%	US$150.5m
GORO Gold Resource	16.4x	n/a	US$156.4m
FTCO Fortitude Gold	8.1x	n/a	US$146.5m
WTGR.F Westgold Resources	11.7x	61.1%	US$575.3m

Forward PE

Price-To-Earnings vs Peers: WTGR.F is expensive based on its Price-To-Earnings Ratio (11.7x) compared to the peer average (10.3x).

Price to Earnings Ratio vs Industry

How does WTGR.F's PE Ratio compare vs other companies in the US Metals and Mining Industry?

Price-To-Earnings vs Industry: WTGR.F is expensive based on its Price-To-Earnings Ratio (11.7x) compared to the US Metals and Mining industry average (8.1x)

Price to Earnings Ratio vs Fair Ratio

What is WTGR.F's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

WTGR.F PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	11.7x
Fair PE Ratio	n/a

Price-To-Earnings vs Fair Ratio: Insufficient data to calculate WTGR.F's Price-To-Earnings Fair Ratio for valuation analysis.

Share Price vs Fair Value

What is the Fair Price of WTGR.F when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: WTGR.F ($0.86) is trading below our estimate of fair value ($17.4)

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

Price to Earnings Growth Ratio

PEG Ratio: WTGR.F is good value based on its PEG Ratio (0.2x)

Discover undervalued companies

Future Growth

How is Westgold Resources forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

61.1%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: WTGR.F's forecast earnings growth (61.1% per year) is above the savings rate (1.9%).

Earnings vs Market: WTGR.F's earnings (61.1% per year) are forecast to grow faster than the US market (13.9% per year).

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

Revenue vs Market: WTGR.F's revenue (15.5% per year) is forecast to grow faster than the US market (8.4% per year).

High Growth Revenue: WTGR.F's revenue (15.5% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: WTGR.F's Return on Equity is forecast to be low in 3 years time (11.4%).

Discover growth companies

Past Performance

How has Westgold Resources performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

53.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: WTGR.F has high quality earnings.

Growing Profit Margin: WTGR.F's current net profit margins (8.5%) are lower than last year (12.8%).

Past Earnings Growth Analysis

Earnings Trend: WTGR.F has become profitable over the past 5 years, growing earnings by 53.3% per year.

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

Earnings vs Industry: WTGR.F had negative earnings growth (-32.1%) over the past year, making it difficult to compare to the Metals and Mining industry average (94.3%).

Return on Equity

High ROE: WTGR.F's Return on Equity (7.9%) is considered low.

Discover strong past performing companies

Financial Health

How is Westgold Resources's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: WTGR.F's short term assets (A$192.5M) exceed its short term liabilities (A$114.8M).

Long Term Liabilities: WTGR.F's short term assets (A$192.5M) exceed its long term liabilities (A$182.4M).

Debt to Equity History and Analysis

Debt Level: WTGR.F is debt free.

Reducing Debt: WTGR.F had no debt 5 years ago.

Debt Coverage: WTGR.F has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: WTGR.F has no debt, therefore coverage of interest payments is not a concern.

Balance Sheet

Discover healthy companies

Dividend

What is Westgold Resources's current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

1.65%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: WTGR.F's dividend (1.65%) is higher than the bottom 25% of dividend payers in the US market (1.57%).

High Dividend: WTGR.F's dividend (1.65%) is low compared to the top 25% of dividend payers in the US market (4.23%).

Stability and Growth of Payments

Stable Dividend: Too early to tell whether WTGR.F's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if WTGR.F's dividend payments are increasing as they only just started paying a dividend.

Earnings Payout to Shareholders

Earnings Coverage: With its low payout ratio (17.3%), WTGR.F's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: WTGR.F is paying a dividend but the company has no free cash flows.

Discover strong dividend paying companies

Management

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

0.8yrs

Average management tenure

CEO

Wayne Bramwell (55 yo)

0.083

Tenure

AU$248,058

Compensation

Mr. Wayne Christopher Bramwell, B.Sc. (Mineral Science - Extractive Metallurgy), Grad Dip Bus, M.Sc. (Mineral Economics), GAICD, serves as Managing Director of Westgold Resources Limited since May 24, 2022...

Leadership Team

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

Board Members

Experienced Board: WTGR.F's board of directors are not considered experienced ( 1 years average tenure), which suggests a new board.

Ownership

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

Insider Trading Volume

Insider Buying: WTGR.F insiders have bought more shares than they have sold 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 11.7%.

Data	Last Updated (UTC time)
Company Analysis	2022/06/27 00:00
End of Day Share Price	2022/06/24 00:00
Earnings	2021/12/31
Annual Earnings	2021/06/30