|
You may now be familiar with the name Vox Royalty. If not, it is time to get familiar with this unique fast-growing, yet undervalued royalty company.
|
As the precious metals bull market is likely around the corner, it’s time to get positioned in best-in-class companies and assets in the sector.
|
With inflation in high gear and the Fed nearly powerless to contain it, gold and the whole precious metals suite would seem to have their best days directly ahead of them.
|
Moreover, investors are starting to understand that royalty companies present a unique opportunity to leverage a precious metals bull market.
Some royalty companies are doing that better than others, delivering value, leverage, cash flow and a lower risk profile.
|
Vox Royalty Corp. (TSXV: VOX; OTCQX: VOXCF) produced these winning traits in spades in 2021 and has set up its business for a big 2022, as three more projects covered by royalties are slated to come into production.
|
Yet so far, the market has yet to fully price in these potential additional producing royalties, making current trading levels for Vox an opportunity you don’t want to pass up.
|
|
Vox’s investments started paying off handsomely in 2021 with …
• Exponential quarterly revenue growth of over 350% from Q3 2020 to Q3 2021, resulting in 2021 revenue guidance being doubled in mid-year
• Going from one producing asset to five, with three more assets expected to come online in 2022
• More than 170,000 meters drilled by operators on 18 different Vox royalty-linked projects — with that number expected to increase to ~200,000 meters over the next year, increasing the likelihood of further discoveries for Vox’s royalties
• New/expanded resource estimates and new royalty-linked discoveries
|
o Thor Explorations (TSXV) upgraded the Segilola gold reserves in March
o Genesis Minerals (ASX) made the Puzzle North gold discovery in April
o Silver Mines (ASX) made the high-grade silver Aegean Zone discovery in May and commenced an underground expansion scoping study in August
o Jangada Mines (LSE) upgraded the Pitombeiras vanadium resource twice in June and in July
o Corazon Mining (ASX) upgraded the Lynn Lake nickel resource in October
o Quantum Graphite (ASX) made a new discovery and published a maiden resource for the Uley 3 graphite deposit in November
|
• More than $50 million spent on drilling and hundreds of millions spent on development by project operators
• Asset de-risking via three economic studies released on assets and five more expected in 2022
• Additional independent research coverage added by Laurentian Bank Securities in November
|
Project operators financed all of this development and progress without a penny of further investment by Vox. This is the kind of risk-limited, exponential upside exposure that best-in-class royalty companies generate.
|
2021 Success Leading To 2022 Value
|
Vox grew exponentially in the revenue column in 2021 and has continued its disciplined approach of seeking great royalties at great value.
Vox is leading the way in return on invested capital amongst its peer groups by a wide margin.
|
Vox has also turned the corner and is now operationally cash flow positive — that’s a big milestone that many of its peers have not yet been able to achieve.
|
As a result, management can get creative in terms of how it sources future royalties.
In addition, Vox has already started returning some of its operational success to shareholders via opportunistic stock buybacks.
Based on consensus analyst estimates, Vox trades at a discount to peers, which are trading in a range of 1.5x – 2.0x Net Asset Value (NAV), while Vox is valued closer to 1.2x based on its broker consensus NAV.
The possibility of a re-rating in the new year looks very real. Combined with Vox’s ability to find significant value in the royalty sector, this prospect offers a compelling value proposition to investors.
Save
Not A Subscriber Yet?
Get Golden Opportunities For Free
Subscribe to our Golden Opportunities e-letter to receive timely market
updates from the Gold Newsletter research team, plus video
presentations by expert speakers from the New Orleans Conference
— and the Investor’s Guide to Gold and Silver — all at no cost!
CLICK HERE to start your subscription.
|
Expansions And New Producing Operations
|
As mentioned, Vox expects three additional projects over which it has royalty rights will begin producing metal over the next twelve months.
Along with these new mines coming online, Vox is expecting significant growth from its Segilola gold royalty, the Dry Creek/Higginsville gold royalty and its Janet Ivy gold royalty.
|
The new producing royalties will give Vox more producing assets than most mid-tier mining companies and more producing assets than any of its small-cap royalty peers.
|
That translates into more revenue growth, more diversification and more exploration upside — all with no additional payments to the operators from Vox.
Is it any wonder why a re-rating looks imminent?
|
|
Golden Opportunities subscribers have had a front row seat to a value-creating 2021 for Vox Royalty.
The catalysts for Vox are significant in 2022:
|
• It has a great balance sheet with no debt and nearly C$10 million in working capital it can deploy into new, value-accretive opportunities;
• It continues to find great opportunities and accretive value around the world and expects a busy year on the transactional front; and
• M&A in the sector is bringing further tailwinds, with Gold Royalty Corp.’s recent hostile takeover offer for Elemental Royalties Corp. serving as a prime example.
|
.png)
