DRI Healthcare Trust

DRI Healthcare Trust (TSX: DHT.UN) is an open-ended trust that provides unitholders with differentiated exposure to the anticipated growth in the global pharmaceuticals and biotechnology markets.

Key Highlights

• The stock has a limited financial history available, and we are not sure about the performance.
• The stock is trading at a higher Price to Cash Flow Multiple of 3.4x against the industry average of 1.0x, which suggest the valuation are stretched at current levels.
• The stock is making lower lows and lower highs on a regular basis, indicating that it is trading in a bearish pattern with the risk of additional market consolidation or decline. Furthermore, the stock is trading far below the key support levels of the 100-day and 50-day SMAs, indicating a bearish trend.
  

Stock recommendation

Recently, the company completed its initial public offering and acquired some royalty assets along other assets and released its first full quarter as a public issuer and we are not sure of its operations and margins as it has a limited historical financial number. Moreover, technical indicators are also suggesting the stock is in a bearish channel and a potential price correction or consolidation is on the cards. Therefore, we recommend an “Avoid” rating on the stock at the closing price of CAD 8.70 as of August 10, 2021, and suggest investors remain on the sidelines and wait for better entry levels.

Technical Price Chart (as on August 10, 2021). Source: REFINITIV, Analysis by Kalkine Group 

Rock Tech Lithium Inc.

Rock Tech Lithium Inc. (TSXV: RCK) is a Canada-based mineral exploration company. The Company holds an interest in the Georgia Lake lithium project in the Thunder Bay Mining District of Ontario.

Key highlights

• The company is exposed to the risk related to its growth, as at present stage they are hardly making any revenues.
• Presently the company has started its Pre-Feasibility Study and expects its production to start by 2023.
• The stock is generating negative return on shareholder’s money, with TTM ROE of negative 53.26%.

Stock recommendation

At the present stage the company is not realizing any sort of revenues and expects its production to start by 2023, implying the company will be incurring losses at least till that date. On the valuation front, the stock is available at TTM P/BV multiple of 17.5x against an industry (Metal & Mining) median of 2.1x. Hence, considering the aforesaid rationale and stretched valuations, we recommend an “Avoid” rating to the stock at the closing price of CAD 5.80 on August 10, 2021.

One-Year Technical Price Chart (as on August 10, 2021). Source: REFINITIV, Analysis by Kalkine Group

Crestview Exploration Inc

Crestview Exploration Inc (CSE: CRS) is a technology driven, well-funded and experienced exploration company focused on finding gold and silver deposits in mining friendly jurisdictions.

Key Highlights

• The company is exposed to the risk related to its growth, as at present stage they are hardly making any revenues.
• During the 6 months ended May 31, 2021, the Corporation used CAD 534,702 of its cash and cash equivalents to meet the Operating Activities compared to CAD 263,151 in 6 months ended May 31, 2020.
• For the 6 months ended May 31, 2021, the Company realized a net loss of CAD 1.23 million compared to a net loss of CAD 0.10 million compared to 6 months ended May 31, 2020.
• CRS shares are available at an TTM Price/Book Value multiple of 3.55x compared to the industry (Metal & Mining) median of 2.1x. This implies that CRS shares are extremely overvalued against the industry.
• The stock is trading far below key support levels of the 100-day and 50-day SMAs, indicating a bearish trend.
  

Stock recommendation

At the present stage the company is not realizing any sort of revenues and even the management has not shared any guidance on its revenue realization. Additionally, the company reported higher input cost in the recent past, which has resulted in a higher deficit. However, the company is in exploration stage and the discovery of the mineral reserves is not certain. Hence, considering the aforesaid facts, we recommend an “Avoid” rating on the stock at the closing price of CAD 0.38 on August 10, 2021.

One-Year Technical Price Chart (as on August 10, 2021). Source: REFINITIV, Analysis by Kalkine Group

*The reference data in this report has been partly sourced from REFINITIV.

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.