Gold Resources Corp.

Gold Resource Corp (NYSE American: GORO) is a company that produces, develops, and explores for gold and silver. It has operations in Oaxaca, Mexico, and Nevada, USA. The company targets projects with low capital expenditure and high potential returns. It also offers its shareholders the option to convert their cash dividends into physical gold and silver.

Recent Financial and Business Updates:

• Second Quarter Income Statement Review:
  • The company's net loss was USD4.6 million for the quarter, or USD0.05 per share on YoY.
  • Total sales for Q2 2023 were USD 8 million, as against USD37.06 million in Q2 2022.
  • Basic and diluted net loss per common share was USD0.05 in Q2 2023, as against USD0.03 in Q2 2022.
• Balance Sheet Review:
  • The company has USD18 million in cash and no debt as on June 30, 2023.
  • The company's working capital is $20.8 million as on June 30, 2023.
  • The company's total cash cost per gold equivalent ounce was USD1,333 in the quarter, and its total all-in sustaining cost per gold equivalent ounce was USD1,990.
  • The company's At the Market Offering Agreement (ATM Agreement) with H.C. Wainwright & Co., LLC was renewed in June 2023. This agreement allows the company to sell its common stock to investors through the agent, H.C. Wainwright & Co., LLC. The maximum aggregate gross sales price of the common stock under the ATM Agreement is USD75 million.
  • The total assets for the quarter amounted to USD191.07 million as of June 30, 2023.
• Business update:
  • Gold Resource Corporation announced that Kimberly Perry is no longer the Chief Financial Officer (CFO). She has served as the CFO since August 10, 2020.
  • Chet Holyoak, the Corporate Controller, has been appointed as the Interim CFO. He is a certified public accountant and has been the Corporate Controller since July 2022.
  • The company reported continued positive drill results at Don David Gold Mine.

Technical Observation (on the daily chart)

Presently, the stock has corrected by approximately 73.78% since reaching its highest point in the past 52 weeks, which occurred on January 26, 2023. The Relative Strength Index (RSI) over a 14-day period stands at 44.35, upward trending and recovering from oversold zone, with expectations of an upside movement. Moreover, the price is currently positioned between both the 21-day SMA and 50-day SMA trend-following indicators, which may act as dynamic short-term support and resistance levels respectively.

As per the above-mentioned price action, recent key business and financial updates, momentum in the stock over the last month, and technical indicators analysis, a “SPECULATIVE BUY” rating is recommended for Gold Resources Corp. (NYSE ARCA: GORO) at its current price of USD 0.49 as on September 15, 2023, at 7:48am PDT. 

Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario.

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing. 

Related Risk: This report may be looked at from a high-risk perspective and a recommendation is provided for a short duration. This report is solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc. 

How to Read the Charts?

The yellow colour line reflects the 21-period simple moving average (SMA) while the blue line indicates the 50- period simple moving average (SMA). SMA helps to identify existing price trends. If the prices are trading above the 21-period and 50-period moving average, then it shows prices are currently trading in a bullish trend.

The orange colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

The red and green colour bars in the chart’s lower segment show the volume of the stock. The volume is the number of shares that changed hands during a given day. Stocks with high volumes are more liquid than stocks with lesser volume as liquidity in stocks helps with easier and faster execution of the order.

The Orange colour lines are the trend lines drawn by connecting two or more price points and used for trend identification purposes. The trend line also acts as a line of support and resistance.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock. 

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock. 

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices. 

The reference date for all price data, currency, technical indicators, support, and resistance levels is September 15, 2023. The reference data in this report has been partly sourced from REFINITIV. 

Abbreviations

CMP: Current Market Price

SMA: Simple Moving Average

RSI: Relative Strength Index

USD: United States dollar 

Note: Trading decisions require a thorough analysis by individual. Technical reports in general chart out metrics that may be assessed by individuals before any stock evaluation. The above are illustrative analytical factors used for evaluating the stocks; other parameters can be looked at along with additional risks per se. Past performance is neither an indicator nor a guarantee of future performance.

Disclaimer

The advice given by Kalkine Canada Advisory Services Inc. and provided on this website is general information only and it does not take into account your investment objectives, financial situation and the particular needs of any particular person. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. The website www.kalkine.ca is published by Kalkine Canada Advisory Services Inc. The link to our Terms & Conditions has been provided please go through them. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations later.