Along with a low price to book value, the junior gold stocks on our list also have relatively little debt compared with its equity value
SmallCapPower | January 17, 2017: Gold has rallied to its strongest level in nearly two months on a weaker U.S. dollar. Today, we have identified five junior gold stocks that have low debt levels yet appear undervalued when compared to industry peers. The debt-to-equity (D/E) ratio indicates how much debt a company is using to finance its assets relative to total shareholder equity value. The price-to-book ratio is a valuation metric used to compare a company’s stock market value to its book value; below 1 meaning the stock may be undervalued.
Timmins Gold Corp. (TSX: TMM) – $0.46
Timmins Gold Corp. is a Canada-based gold producer engaged in the operation, development, exploration and acquisition of resource properties in Mexico through its subsidiaries, Timmins Goldcorp Mexico, S.A. de C.V. and Molimentales del Noroeste, S.A. de C.V. (MdN). MdN owns the San Francisco Mine in Sonora, Mexico. MdN also owns the Caballo Blanco Property, an exploration and evaluation asset in Veracruz, Mexico. As well, Timmins Gold holds the Ana Paula gold project, which is an advanced-stage development project in the Guerrero Gold Belt.
- Market Cap: $163 million
- Total Revenue (LTM): $156 million
- Debt to Equity (FY0): 13.2%
- Price To Book Value: 0.90
Sabina Gold & Silver Corp. (TSX: SBB) – $1.27
Sabina Gold & Silver Corp. is a precious metals company. Its principal assets are the Back River gold project and its silver royalty on the Hackett River project, both of which are located in Nunavut, Canada. The Company also has exploration properties in Nunavut and in the vicinity of the Red Lake gold camp in Ontario. The Back River Project is located approximately 520 kilometers North East of Yellowknife and over 70 kilometers south of Bathurst Inlet.
- Market Cap: $279 million
- Total Revenue (LTM): 0
- Debt to Equity (FY0): 0.1%
- Price To Book Value: 0.82
Argonaut Gold Inc. (TSX: AR) – $2.75
Argonaut Gold Inc. is engaged in gold mining, mine development and mineral exploration activities at gold-bearing mineral properties in North America. It owns the producing El Castillo mine in the State of Durango, Mexico; the producing La Colorada mine in the State of Sonora, Mexico; the advanced exploration-stage San Antonio property in the State of Baja California Sur, Mexico; the advanced exploration-stage Magino property in the Province of Ontario, Canada; the advanced exploration-stage San Agustin property located approximately 10 kilometers from the El Castillo mine in the State of Durango, Mexico, and various other exploration stage projects, all of which are located in North America.
- Market Cap: $435 million
- Total Revenue (LTM): $187 million
- Debt to Equity (FY0): 0.7%
- Price To Book Value: 0.59
Metanor Resources Inc. (TSXV: MTO) – $0.06
Metanor Resources Inc. is engaged in the acquisition, exploration and development of mining properties, as well as the commercial production of the ore reserves of its Bachelor Lake and Hewfran properties. The Company operates through three segments: the mining site (Bachelor mine), exploration and corporate. The Bachelor Mine is located approximately 90 kilometers northeast of the city of Lebel-sur-Quevillon, Quebec, Canada. The Bachelor property consists of approximately 240 claims and over two mining concessions covering an area of approximately 7,566.73 hectares.
- Market Cap: $26 million
- Total Revenue (LTM): $50 million
- Debt to Equity (FY0): 15.5%
- Price To Book Value: 0.47
St Augustine Gold and Copper Ltd. (TSX: SAU) – $0.05
St. Augustine Gold and Copper Limited is focused on the acquisition, development and exploration of mineral properties. The Company is engaged in the business of mineral property exploration and its only activity is the development of the King-king copper-gold property (King-king, or the Project). The King-king copper-gold property is a copper-gold mineral reserve located at Sitio Gumayan, Barangay King-king, Municipality of Pantukan, Province of Compostela Valley, on Mindanao Island, Philippines. The Company is in the process of earning approximately 60% economic interest in the Project from Nationwide Development Corporation (NADECOR).
- Market Cap: $36 million
- Total Revenue (LTM): 0
- Debt to Equity (FY0): 0.0%
- Price To Book Value: 0.25