GRZ  Gold Reserve Inc

Exchange

AMEX

Sector

Basic Industries

Industry

Precious Metals

Market Cap.

171.9M

Vuru Grade

10.60/100

Current Price

$2.85
+0.02 (+0.71%)

Stability Price

$0.10
Overvalued by 96.45%

Company Metrics

  • P/E 0
  • P/S 0
  • P/B 22.95
  • EPS -0.348
  • Cash ROIC -62.29%
  • Cash Ratio 11.31
  • Dividend 0 / 0%
  • Avg. Vol. 173,933.00
  • Shares 384.27M
  • Market Cap. 171.9M

Company Description

Gold Reserve Inc., an exploration stage company, engages in the acquisition, exploration, and development of mining projects. The company was founded in 1956 and is based in Spokane, Washington.... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

Partnering With Venezuela: Updates On Gold Reserve, Inc.
Seeking Alpha - Oct 16, 2017
Despite its political instability and being on the verge of default, Venezuela appears to be honoring the payment terms under its 2017 $1B settlement agreement made with Gold Reserve, Inc. Progress is being made by Venezuela and Gold Reserve in ...
Gold Reserve, Inc.: A High-Risk/High-Reward Opportunity
Seeking Alpha - Nov 21, 2016
Venezuela breached its August 8 settlement agreement with Gold Reserve, Inc., failing to pay the first instalment of the $1,009,000,000 due October 31.
Should You Risk Buying Gold Reserve Inc. In Light Of Venezuela's $1 Billion ...
Seeking Alpha - Oct 10, 2016
In October 2009, Gold Reserve Inc. filed a demand for arbitration against Venezuela for compensation under the Additional Facility Rules of the International Centre for Settlement of Investment Disputes ('ICSID'), part of the World Bank, which was ...
Steelhead Partners, LLC Announces Conversion of Convertible Notes of Gold ...
MarketWatch - Aug 11, 2017
BELLEVUE, WA, Aug. 11, 2017 (Canada NewsWire via COMTEX) -- Steelhead Partners, LLC ("Steelhead"), on behalf of Steelhead Navigator Master, L.P.
Venezuela To Pay Gold Reserve $1B Under New Settlement
Law360 - Jun 16, 2017
Law360, New York (June 16, 2017, 7:14 PM EDT) -- Gold Reserve Inc. said Friday it's received an initial $40 million payment of a $1.032 billion settlement with Venezuela to resolve a dispute over a canceled mining project, a day after the parties told ...
Gold Reserve Inc (GRZ.V) Sees Nice Weekly Performance
Morgan Research - 14 hours ago
Gold Reserve Inc (GRZ.V) shares are showing positive momentum over the past week as the stock has clocked in with gains of 0.95%.
Gold Reserve Inc (GDRZF) Sees Nice Weekly Performance
Morgan Research - 14 hours ago
Gold Reserve Inc (GDRZF) shares are showing positive momentum over the past week as the stock has clocked in with gains of 4.56%.
The Paris Court of Appeal Decides in Favor of Gold Reserve Inc.
Business Wire (press release) - Feb 7, 2017
SPOKANE, Wash.--(BUSINESS WIRE)--Gold Reserve Inc. (TSX.V:GRZ) (OTCQB:GDRZF) (“Gold Reserve” or the “Company”) announces that on February 7, 2017, the Paris Court of Appeal (the “Court”) rejected all of Venezuela's arguments and issued a ...
Paris Appeals Court Upholds $740M Award Against Venezuela - Law360
Gold Reserve Provides Venezuela Update
Business Wire (press release) - Jun 30, 2017
BUSINESS WIRE)--Gold Reserve Inc. (TSX.V: GRZ) (OTC: GDRZF) (“Gold Reserve” or the “Company”) is pleased to provide an update on the activities in Venezuela on the Brisas Cristinas Project which is owned 55% by Venezuela and 45% by a subsidiary of Gold ...
Gold Reserve Reports on Pending Settlement Payment from Venezuela
Business Wire (press release) - Dec 16, 2016
BUSINESS WIRE)--Gold Reserve Inc. (TSX.V:GRZ) (OTCQB:GDRZF) (“Gold Reserve” or the “Company”) today reported that the government of the Bolivarian Republic of Venezuela has informed the Company that the payment of US$300 million that was due December ...
Gold Reserve Says Venezuela Sending $300 Million on $770 Million Award - Latin American Herald Tribune
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for GRZ to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate GRZ's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$2.85 Current Price

$-0.29 Growth Price (DCF)

Why is this negative?


Show Free Cash Flow numbers

$0.10 Stability Price (EPV)

Overvalued by 96.45%


Discount Rate: 15.0%

$0.02 NCA Price

Overvalued by 99.14%

$-0.30 Book Price

Overvalued by 110.51%


Very Poor Cash Return on Invested Capital over the past 5 years

GRZ has failed to generate positive returns on its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

GRZ has lost $62.29 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20122013201420152016
Free Cash Flow -57.78M -40.88M -26.32M -21.42M -18.75M
divided by
Invested Capital 508.01M 602.51M 595.84M 21.70M 9.86M
Cash ROIC -11.37% -6.78% -4.42% -98.71% -190.14%

Very Poor Return on Equity over the past 5 years

GRZ has shown an inability to deliver results for shareholders. This could be due to poor management, GRZ operating in a highly competitive industry, or having a weak business in general.

GRZ has generated a $2,950.91 loss for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20122013201420152016
Net Income -11.44M -2.49M -6.83M -647.75M -71.52M
divided by
Stockholders' Equity 584.35M 641.51M 593.96M 4.61M 10.09M
Return on Equity -1.96% -0.39% -1.15% -14,041.92% -709.12%

Poor Business Performance over the past 10 years

GRZ's inability to produce positive free cash flow for the majority of the past 10 years is concerning. It should be a red flag, since this company does not have a track record of delivering results for shareholders. This could be due to poor management or the nature of its business.

GRZ has been losing money for the majority of the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Free Cash Flow -50.36M -52.56M -32.90M -29.93M -17.95M -57.78M -40.88M -26.32M -21.42M -18.75M

Weak Balance Sheet

GRZ's financial position is not ideal. The key is to check whether GRZ is using debt to fuel its growth and the sustainability of that tendency. Highly capital intensive businesses (see Economic Moat) follow this route, which can deeply impact the future prospects of the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Cash 99.67M 94.02M 72.30M 68.42M 58.76M 78.97M 42.12M 44.16M 18.57M 60.27M
Current Assets 100.32M 94.02M 72.30M 69.93M 59.21M 81.66M 45.36M 45.30M 39.20M 74.80M
Total Assets 281.90M 287.61M 119.92M 98.43M 78.34M 602.69M 658.31M 648.07M 44.42M 75.46M
Current Liabilities 7.96M 8.37M 4.02M 1.87M 2.31M 15.71M 13.68M 8.08M 4.15M 5.33M
Total Liabilities 80.58M 102.51M 100.00M 98.84M 104.14M 18.33M 16.80M 54.12M 39.80M 65.37M
Stockholder' Equity 201.32M 185.11M 19.92M -412,755.00 -25.80M 584.35M 641.51M 593.96M 4.61M 10.09M
Current Ratio 12.61 11.23 17.97 37.44 25.63 5.20 3.32 5.61 9.46 14.04
TL-to-TA 0.29 0.36 0.83 1.00 1.33 0.03 0.03 0.08 0.90 0.87

Low or No Reinvestment of Profits over the past 10 years

GRZ has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to GRZ operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Retained Earnings -81.37M -100.18M -265.63M -289.18M -292.18M -262.50M -264.99M -291.74M -919.57M -991.09M
Retained Earnings Growth - -23.12% -165.15% -8.86% -1.04% 10.16% -0.95% -10.09% -215.20% -7.78%

Erratic Net Profit Margins over the past 10 years

GRZ has had highly erratic net profit margins which are a great cause for concern. This company may operate in a highly volatile industry, or it may just have poor performance. Look at reasons for this inconsistency to understand if there is any reason to look past it.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Net Income -12.41M -19.73M -165.45M -23.55M -23.61M -11.44M -2.49M -6.83M -647.75M -71.52M
divided by
Revenue 6.50M 2.44M 3.17M 958,368.00 2.36M - - - - -
Net Profit Margin -190.97% -806.87% -5,226.27% -2,456.98% -1,001.16% - - - - -

Varying Pricing Power over the past 10 years

GRZ has maintained substantial gross margins, suggesting that they have been able to set prices without consideration of the cost of goods sold. However, there is a substantial variation in their Gross Profit Margins from year-to-year, which indicates inconsistent performance. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

$50.00 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Gross Profit 6.50M 2.44M 3.17M 958,368.00 2.36M - - - - -
divided by
Revenue 6.50M 2.44M 3.17M 958,368.00 2.36M - - - - -
Gross Margin 100.00% 100.00% 100.00% 100.00% 100.00% - - - - -

Low Capital Intensity over the past 10 years

GRZ has consistently used a small portion of their Net Income buying new equipment or investing in new facilities. This indicates that GRZ may require minimal investment to stay competitive. This leaves them with extra money to spend on growing their business and potentially buying back stock.

-% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Capital Expenditure 44.69M 38.70M 17.77M 9.50M 50,478.00 51.10M 40.29M 18.66M 9.64M 54,000.00
divided by
Net Income -12.41M -19.73M -165.45M -23.55M -23.61M -11.44M -2.49M -6.83M -647.75M -71.52M
Capital Expenditure Ratio -360.06% -196.18% -10.74% -40.33% -0.21% -446.60% -1,618.15% -273.38% -1.49% -0.08%

No Dividend History over the past 10 years

GRZ has never distributed dividends or has recently suspended their dividend distribution.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Dividend Paid - - - - - - - - - -
divided by
Shares Outstanding 49.70M 55.99M 57.31M 57.75M 59.47M 407.96M 383.81M 384.15M 384.15M 384.27M
Dividend Paid Per Share - - - - - - - - - -
Price at Year End 5.09 0.81 1.07 1.82 2.80 2.93 2.91 2.91 0.08 5.41
Dividend Yield - - - - - - - - - -

History of Stock Buybacks over the past 10 years

GRZ has some history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Shares Outstanding 49.70M 55.99M 57.31M 57.75M 59.47M 407.96M 383.81M 384.15M 384.15M 384.27M
Stock Bought Back - -11.22% -2.30% -0.77% -2.89% -85.42% 6.29% -0.09% -0.00% -0.03%
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