SouthGobi Resources Ltd. (SGQ) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

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Comparison

Company

Score

Quality

Valuation

Financial

Technical

Canaf Investments, Inc.

Saturn Oil & Gas, Inc.

Teck Resources Limited

Corsa Coal Corp.

SouthGobi Resources Ltd.

Colonial Coal International Corp.

Morien Resources Corp.

Am Resources Corp.

Why is SouthGobi Resources Ltd. ?

With a Negative Book Value, the company has a Weak Long Term Fundamental Strength

Low ability to service debt as the company has a high Debt to EBITDA ratio of 3.13 times

Risky -

The stock is trading risky as compared to its average historical valuations
Over the past year, while the stock has generated a return of -50.00%, its profits have fallen by -60.6%

Below par performance in long term as well as near term

Along with generating -50.00% returns in the last 1 year, the stock has also underperformed S&P/TSX 60 in the last 3 years, 1 year and 3 months

Real-Time Research Report

Verdict Report

How much should you sell?

All quantity irrespective of whether you are making profits or losses

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Miscellaneous)

When to re-enter? - We will constantly monitor the company and review our call based on new data

Is SouthGobi Resources Ltd. for you?

High Risk, Low Return

Absolute

Risk Adjusted

Volatility

SouthGobi Resources Ltd.

-46.92%

-0.37

128.49%

S&P/TSX 60

19.1%

1.23

15.27%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

50.20%

EBIT Growth (5y)

36.16%

EBIT to Interest (avg)

1.20

Debt to EBITDA (avg)

3.13

Net Debt to Equity (avg)

-2.60

Sales to Capital Employed (avg)

4.31

Tax Ratio

31.77%

Dividend Payout Ratio

Pledged Shares

Institutional Holding

0.05%

ROCE (avg)

60.27%

ROE (avg)

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

-0.82

EV to EBIT

4.65

EV to EBITDA

2.97

EV to Capital Employed

2.77

EV to Sales

0.51

PEG Ratio

Dividend Yield

ROCE (Latest)

59.54%

ROE (Latest)

Negative BV

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

RSI

No Signal

Bollinger Bands

Mildly Bearish

Moving Averages

Bearish (Daily)

KST

Bullish

Dow Theory

Bearish

No Trend

OBV

Mildly Bullish

No Trend

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

6What is working for the Company

NET SALES(HY)

At CAD 391.2 MM has Grown at 64.5%

INVENTORY TURNOVER RATIO(HY)

Highest at 6.07%

-19What is not working for the Company

RAW MATERIAL COST(Y)

Grown by 120.99% (YoY

OPERATING PROFIT(Q)

Lowest at CAD -13.28 MM

OPERATING PROFIT MARGIN(Q)

Lowest at -6.18 %

PRE-TAX PROFIT(Q)

Lowest at CAD -41.14 MM

NET PROFIT(Q)

Lowest at CAD -40.3 MM

Here's what is working for SouthGobi Resources Ltd.

Net Sales

At CAD 391.2 MM has Grown at 64.5%

Year on Year (YoY)

MOJO Watch

Near term sales trend is positive

Net Sales (CAD MM)

Inventory Turnover Ratio

Highest at 6.07%

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its inventory faster

Inventory Turnover Ratio

Depreciation

Highest at CAD 17.19 MM

in the last five periods

MOJO Watch

The expenditure on assets done by the company may have gone into operation

Depreciation (CAD MM)

Depreciation

At CAD 17.19 MM has Grown at 29.37%

period on period (QoQ)

MOJO Watch

The expenditure on assets done by the company has gone into productive use which should positively reflect in the future sales

Depreciation (CAD MM)

Here's what is not working for SouthGobi Resources Ltd.

Pre-Tax Profit

At CAD -41.14 MM has Fallen at -272.2%

over average net sales of the previous four periods of CAD 23.89 MM

MOJO Watch

Near term Pre-Tax Profit trend is very negative

Pre-Tax Profit (CAD MM)

Net Profit

At CAD -40.3 MM has Fallen at -329.99%

over average net sales of the previous four periods of CAD 17.52 MM

MOJO Watch

Near term Net Profit trend is very negative

Net Profit (CAD MM)

Operating Profit

Lowest at CAD -13.28 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is negative

Operating Profit (CAD MM)

Operating Profit Margin

Lowest at -6.18 %

in the last five periods

MOJO Watch

Company's profit margin has deteriorated

Operating Profit to Sales

Pre-Tax Profit

Lowest at CAD -41.14 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is negative

Pre-Tax Profit (CAD MM)

Net Profit

Lowest at CAD -40.3 MM

in the last five periods

MOJO Watch

Near term Net Profit trend is negative

Net Profit (CAD MM)

Raw Material Cost

Grown by 120.99% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has deteriorated; this may lead to a fall in profit margin

Raw Material Cost as a percentage of Sales