KDX.TO  Klondex Mines Ltd

Exchange

TSX

Sector

Mining

Industry

Market Cap.

792.00M

Vuru Grade

7.50/100

Current Price

$4.46
+0.09 (+2.06%)

Growth Price

$1.17
Overvalued by 73.81%

Company Metrics

  • P/E 106.19
  • P/S 3.23
  • P/B 2.71
  • EPS 0.04
  • Cash ROIC -16.00%
  • Cash Ratio 1.14
  • Dividend 0 / 0%
  • Avg. Vol. 638,878.00
  • Shares 146.30M
  • Market Cap. 792.00M

Company Description

Klondex Mines Ltd., together with its subsidiary, Klondex Gold and Silver Mining Co., engages in owning, evaluating, acquiring, exploiting, exploring, and developing mineral properties in Nevada. The company focuses on gold and silver properties. It primarily holds a 100% interest in the Fire Creek gold property comprising 484 claims in 11, 207.7 acres located along the Northern Nevada Rift in Nor... more


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

News

Contrasting Klondex Mines (KLDX) & Iamgold Corporation (IAG)
The Ledger Gazette - Aug 21, 2017
Klondex Mines logo Klondex Mines Ltd is a Canada-based gold and silver mining company. The Company focuses on exploration, development and production of over two gold and silver projects in north central Nevada, being the Fire Creek mine located in ...
Klondex Mines set to bring Hollister and True North mines into production
Proactive Investors UK - Sep 20, 2017
Meanwhile, he explained how the True North mine and mill in Manitoba was a great opportunity to scale up the group's production, buying it as it did from bankruptcy for just $32mln.
Tale of the Tape: Klondex Mines Ltd. (NYSE:KLDX) Moves 1.12% - Concord Register
Clarus Securities Analysts Lower Earnings Estimates for Klondex Mines Ltd (KDX) - The Ledger Gazette
Klondex Mines donates Rock Creek lands to Shoshone Indians
Proactive Investors UK - Sep 18, 2017
Klondex Mines Ltd (TSE:KDX, NYSEMKT:KLDX) has transferred the Rock Creek lands to the Shoshone Indians of Nevada, it said. The lands for thousands of years were traditionally used by the Indians for healing ceremonies and as a source of medicinal ...
IGM Financial, CI Financial, Klondex Mines - Times of India
Running Out Of Momentum? – Klondex Mines Ltd. (KLDX), Oasis Petroleum Inc. (OAS) - Post Analyst
Klondex Mines: Stop Shorting These Shares Now
Seeking Alpha - Aug 11, 2017
In May 2017, in my Marketplace section, I discussed the latest developments at Klondex Mines (KLDX), a mid-tier gold producer specializing in narrow vein mining. Although I was still quite skeptical about Klondex (refer to my initial article on this ...
Klondex Mines raises production guidance after sparkling quarter at its Nevada ... - Proactive Investors UK
Have You Considered Klondex Mines Ltd.? - The Motley Fool Canada
Klondex Mines: The Midas Mine Without The Midas Touch
Seeking Alpha - Feb 10, 2017
Klondex Mines (NYSEMKT:KLDX) is about high-grade gold ore. The company runs the world's highest grade gold mine called Fire Creek, located in Nevada, USA.
Klondex Mines edges higher after releasing underground drilling results from ...
Proactive Investors UK - Sep 15, 2017
Shares in Klondex Mines Ltd (TSE:KDX, NYSEMKT:KLDX) edged up after the company issued an update on underground drilling results at its Fire Creek mine.
Klondex Mines Ltd (KDX) Director Blair Schultz Acquires 25000 Shares - The Ledger Gazette
Does Klondex Mines Ltd's (TSX:KDX) PE Ratio Signal A Selling Opportunity? - Simply Wall St
Klondex Mines set to buy Canadian explorer Bison Gold Resources
Proactive Investors UK - Aug 8, 2017
Precious metals producer Klondex Mines Ltd (NYSE:KLDX, TSE:KDX) reported it is set to acquire Bison Gold Resources Inc (CVE:BGE) - a Canada focused gold exploration firm.
Klondex Mines continuing to progress True North and Hollister projects as ...
Proactive Investors UK - Jul 31, 2017
Precious metals miner Klondex Mines Ltd (TSE:KDX, NYSE:KLDX) has had an encouraging few months and in July posted operating results for its second quarter, which it described as the "best in its history".
1 Gold Miner Under $5 That Could Double - The Motley Fool Canada
Calculating the fair value of Klondex Mines Ltd (TSX:KDX)
Simply Wall St - Aug 24, 2017
In this article I am going to calculate the intrinsic value of Klondex Mines (TSX:KDX) by taking the expected future cash flows and discounted them to the value today.
Klondex Mines' (KLDX) CEO Paul Huet on Q2 2017 Results - Earnings Call Transcript
Seeking Alpha - Aug 10, 2017
Thank you for standing by. This is the Chorus Call conference operator. Welcome to the Klondex Mines Second Quarter 2017 Results Conference Call.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for KDX.TO 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 KDX.TO'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.

$4.46 Current Price

$1.17 Growth Price (DCF)

Overvalued by 73.81%


Growth Rate Assumed by Market: 500.00%


Future Free Cash Flow Growth Rate: 0.0%


Discount Rate: 15.0%


KDX.TO's most recent year of (normalized) free cash flow is negative. This is the base number for forward projections. This means that if you increase the growth rate, the amount of negative FCF grows, thereby decreasing the price.

Show Free Cash Flow numbers

$3.58 Book Price

Overvalued by 19.70%


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

KDX.TO 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.

KDX.TO has lost $16.00 of cash for every $100 invested.
Figures in CAD. Fiscal year ends in December
20122013201420152016
Free Cash Flow -23.50M -28.04M -128,000.00 1.81M -16.45M
divided by
Invested Capital 56.81M 82.88M 213.02M 201.46M 290.65M
Cash ROIC -41.36% -33.83% -0.06% 0.90% -5.66%

Very Poor Return on Equity over the past 5 years

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

KDX.TO has generated a $0.28 loss for every $100 of Shareholders' Equity.
Figures in CAD. Fiscal year ends in December
20122013201420152016
Net Income -3.83M -14.12M 18.30M 22.53M -1.70M
divided by
Stockholders' Equity 74.27M 86.44M 192.56M 201.20M 278.05M
Return on Equity -5.16% -16.34% 9.50% 11.20% -0.61%

Poor Business Performance over the past 10 years

KDX.TO'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.

KDX.TO has been losing money for the majority of the past 10 years.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Free Cash Flow -774,523.00 -6.37M -3.53M -6.44M -3.46M -23.50M -28.04M -128,000.00 1.81M -16.45M

Strong Balance Sheet

KDX.TO is financially strong with Current Assets covering Total Liabilities. It's in a fairly liquid position and dependent on the amount and saleability of any inventory; it may have the financial security to survive an economic downturn.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Cash 4.24M 1.85M 3.55M 7.73M 24.62M 18.05M 13.51M 52.77M 59.10M 47.64M
Current Assets 4.33M 1.88M 3.63M 7.97M 25.03M 18.32M 13.83M 86.43M 85.70M 74.87M
Total Assets 20.37M 23.43M 27.31M 37.42M 70.91M 90.38M 109.85M 296.21M 283.85M 379.98M
Current Liabilities 748,752.00 2.46M 599,161.00 2.86M 2.06M 15.51M 13.46M 30.42M 23.29M 41.69M
Total Liabilities 756,140.00 2.46M 785,561.00 3.36M 15.69M 16.10M 23.41M 103.65M 82.65M 101.92M
Stockholder' Equity 19.61M 20.97M 26.52M 34.06M 55.22M 74.27M 86.44M 192.56M 201.20M 278.05M
Current Ratio 5.79 0.77 6.06 2.78 12.13 1.18 1.03 2.84 3.68 1.80
TL-to-TA 0.04 0.11 0.03 0.09 0.22 0.18 0.21 0.35 0.29 0.27

Low or No Reinvestment of Profits over the past 10 years

KDX.TO has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to KDX.TO 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 CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Retained Earnings -9.63M -10.79M -13.20M -18.19M -26.00M -29.83M -43.95M -25.65M -3.60M -58.28M
Retained Earnings Growth - -11.98% -22.37% -37.79% -42.95% -14.74% -47.34% 41.64% 85.96% -1,518.44%

Highly Competitive Industry over the past 10 years

It's likely that KDX.TO is in an industry with low barriers to entry, spurring high competition. If Gross Margins are at least satisfactory, it's likely KDX.TO invests heavily in R&D and Sales, General & Administrative expenses.

Only $2.87 of every $100 of Revenue have been profit, on average over the past 10 years.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Net Income -1.25M -1.15M -2.41M -4.99M -6.08M -3.83M -14.12M 18.30M 22.53M -1.70M
divided by
Revenue - - - - - - - 121.69M 155.16M 198.18M
Net Profit Margin - - - - - - - 15.04% 14.52% -0.86%

Weak Pricing Power over the past 10 years

KDX.TO is likely in a highly competitive industry, due to low barriers to entry. It's because of this, that KDX.TO has been unable to raise prices and increase their profitability. This puts them in a poor position if inflation becomes an issue, as they would struggle to pass higher costs onto consumers.

Only $8.74 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Gross Profit - - - - - - - 36.04M 42.22M 60.68M
divided by
Revenue - - - - - - - 121.69M 155.16M 198.18M
Gross Margin - - - - - - - 29.62% 27.21% 30.62%

High Capital Intensity over the past 10 years

KDX.TO spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

192.00% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Capital Expenditure 10,454.00 5.52M 2.18M 4.14M 501,776.00 21.25M 24.91M 33.21M 45.62M 61.72M
divided by
Net Income -1.25M -1.15M -2.41M -4.99M -6.08M -3.83M -14.12M 18.30M 22.53M -1.70M
Capital Expenditure Ratio -0.83% -477.92% -90.52% -82.97% -8.25% -554.47% -176.44% 181.49% 202.50% -3,630.35%

No Dividend History over the past 10 years

KDX.TO has never distributed dividends or has recently suspended their dividend distribution.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Dividend Paid - - - - - - - - - -
divided by
Shares Outstanding 22.77M 23.32M 28.36M 32.72M 37.62M 49.02M 66.24M 117.91M 139.00M 146.30M
Dividend Paid Per Share - - - - - - - - - -
Price at Year End 2.17 0.74 1.29 2.53 2.26 1.18 1.59 1.93 2.82 6.25
Dividend Yield - - - - - - - - - -

No History of Stock Buybacks over the past 10 years

We're neutral on this. It's not necessarily good or bad that KDX.TO hasn't initiated a stock buyback.
Figures in CAD. Fiscal year ends in December
2007200820092010201120122013201420152016
Shares Outstanding 22.77M 23.32M 28.36M 32.72M 37.62M 49.02M 66.24M 117.91M 139.00M 146.30M
Stock Bought Back - -2.37% -17.77% -13.33% -13.02% -23.26% -26.00% -43.82% -15.17% -4.99%
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