EMX Royalty: Timok's Size And Longevity Could Be Underestimated

Bujon Capital
1.13K Followers
(20min)

Summary

  • EMX owns royalties on world-class deposits while trading at a deeply discounted valuation even though the growth outlook is robust and the balance sheet is healthy.
  • I have been following the development of the Timok copper and gold deposit in Serbia since 2016 and I view it as one of the best discoveries in decades.
  • In September 2023, Zijin Mining announced investments of $3.8 billion to develop the Lower Zone at Timok making EMX one of the key beneficiaries.
  • EMX is trading at an enterprise value per GEO of $17,424 which is by far the lowest among its peers. The valuation gap could potentially make EMX an acquisition target.

Surface coal mine site, elevated view

Monty Rakusen

Thesis

EMX (NYSE:EMX) owns royalties on world-class deposits while trading at a deeply discounted valuation even though the growth outlook is robust and the balance sheet is healthy. The production ramp-up at Timok and EMX's potential of

This article was written by

1.13K Followers
For almost a decade, I held research analyst positions in various investment firms, mostly in Toronto. I started in sell-side research with a Canadian bank, then moved to a hedge fund, followed by a family office and finished my career in wealth management. I was 20 on my first day on Bay Street, I will forever remember. I had worked so hard to get there, from a small French-speaking town in Québec. Getting my CFA at 25 was another important milestone. I was a young man with a dream, wanting to make it big. However, life was about to teach me a painful lesson. Before conquering the world, a man must first conquer himself by going into the depths of his own abyss. Only then may he shed his naivety and become a man.In the summer of 2020, the edifice I had built for myself in the city started to collapse. So many parts of my world crumbled one after the other that I saw death as the outcome. It is only at rock bottom that I found the cure to my existential crisis. With the last breath of life that emerged from my ashes, I then created a paradise.I have been living in a yurt in the boreal forest for three years now. In a forest full of birds, just beside a lake full of fish. For water, I go to the lake or the creek. For heat, there is plenty of white birch and quaking aspen around. If I need anything in town, I have plenty of money for my needs. I will turn 30 this summer, and I am as free as the birds in the skies, so what else can I ask for? I was supposed to be dead by now, so in all humility, and in all gratitude, I say thank you to this grandiose symphony we call life."Do not store up for yourselves treasures on earth, where moth and rust destroy, and where thieves break in and steal. But store up for yourselves treasures in heaven, where moth and rust do not destroy, and where thieves do not break in and steal. For where your treasure is, there your heart will be also." Matthew 6:19

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

This writing is for informational purposes only. It does not constitute an offer to sell, a solicitation to buy, or a recommendation regarding any securities transaction. I am not associated with any of the companies mentioned in this article.

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