Vizsla Copper Corp., a mineral exploration company, focuses on copper properties in Canada. Its projects include the Blueberry project covering an area of 11,500 hectares and16 contiguous mineral claims located to the southwest of the town of Houston, British Columbia; and the Carruthers Pass project located in British Columbia. The company was formerly known as NorthBase Resources Inc. and changed its name to Vizsla Copper Corp. in April 2021. Vizsla Copper Corp. was incorporated in 2017 and is headquartered in Vancouver, Canada.

Canada

Vizsla Copper Corp.

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. 

VCU.V reported revenue of CAD 0mn in the last 12 months, down 0% from FY22. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. EPS fell 70% from FY22 to CAD -0.03.

The stock's performance has been mixed in the past six months, with growth following a decline. There is no clear price trend compared to its global peers from the same sector and industry (as shown above). It has underperformed this peer group by 14ppts over six months and grown 4ppts slower in the past month. This is largely true for peers from the same country and sector. With respect to the stock's valuation against its peers, its overall price performance is neutral.

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been -1.0 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.

VCU.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 usually stable and becomes extremely unfavourable on the days with the lowest activity. However, under highly turbulent market conditions, the trading volume tends to improve significantly. 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, we point to weak positions in its industry, negligible return on capital, inadequate interest coverage, and poor cash flow generation. We note an favourable capital structure, among the positive credit factors. 

In highly turbulent market conditions, VCU.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, VCU.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. 

Based on key historical and expected multiples, the stock is greatly undervalued relative to its peers. 

Vizsla Copper Corp.

CA$ 0.07

3

Vizsla Copper Corp.

CA$ 0.07

3

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

CA$ 0.07

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