Starr Peak Mining Ltd., an exploration stage junior mining company, engages in the identification, acquisition, and exploration of mineral properties in Canada. The company explores for gold. It holds a 100% interest in NewMetal Property comprising 53 mineral claims covering an area of 1,420 hectares located in the northwestern Quebec. The company was formerly known as Starr Peak Exploration Ltd. and changed its name to Starr Peak Mining Ltd. in March 2021. Starr Peak Mining Ltd. was incorporated in 1981 and is headquartered in Vancouver, Canada.

Canada

Starr Peak Mining Ltd.

Basic Materials

The company does not pay dividends at all, or it pays them sporadically. There have only been a few years with dividend payments in the past ten years. 

STE.V reported revenue of CAD 0mn in the last 12 months, down 0% from FY23. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. EPS grew 237% from FY23 to CAD -0.07.

Over the last six months, the stock performance has varied, with an increase following a drop. The stock's price trend wasn't definitive when matched against its global counterparts from the same sector and industry (as depicted above). Over the past six months the stock has exceeded the performance of this peer group by 24ppts and its growth accelerated by 8ppts in the past month. This is equally valid for peers from the same country and industry. Given the stock's valuation versus its peers, its total price movement is mildly favourable.

Starr Peak Mining Ltd. reported a return on equity (RoE) of -28.9% in the last 12 months, down from -25.9% in FY24. 

Another important profitability metric, return on assets (RoA), amounted to -23.4% in the last 12 months, a decrease from -23.1% in FY24. 

In the last 12 months, the return on capital employed (RoCE) declined to -28.9%, below the peers. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been -2.4 in the past several years. This ratio implies a fragile shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are minimal. In combination with stringent business standards, shareholder rights are very highly protected.

STE.V has very poor trading liquidity. It will take considerable time for the average private investor to sell a common position under normal market conditions. Liquidity is relatively stable and becomes extremely unfavourable on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. Another factor to consider is the substantial number of days with zero trading volumes, i.e., without any ability to sell a position. The stock has a tiny market capitalisation, which usually makes its trading liquidity erratic and unpredictable. 

No other major risks have been identified.

The risk of default is high. Among the negative credit factors and we point to weak positions in its industry, negligible return on capital. We note an favourable capital structure, among the positive credit factors. 

In highly turbulent market conditions, STE.V is exceptionally volatile. In other words, the stock will be among the worst-performers in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be critical. 

In normal market circumstances, STE.V is exceptionally volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will change quite unpredictably. The stock's losses on its worst days (less than 1-5% of the time) will range from critical to immense. 

Considering past and projected metrics, the stock is neither 'expensive' nor 'cheap' compared to its peers. 

Starr Peak Mining Ltd.

CA$ 0.39

3

Starr Peak Mining Ltd.

CA$ 0.39

3

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

CA$ 0.39

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