Q: I have a very small position in Royal Helium... it is down a lot. I am wondering what you think.
Helium is a finite/diminishing resource that is key for things like computing and semi conductors and certain high tech equipment - i'd have thought with the AI craze and Royal Helium finally producing/being one of the few (only) traded companies in Canada with active production.. but it has just kept falling.
Helium is a finite/diminishing resource that is key for things like computing and semi conductors and certain high tech equipment - i'd have thought with the AI craze and Royal Helium finally producing/being one of the few (only) traded companies in Canada with active production.. but it has just kept falling.
5i Research Answer:
We think it is an issue with the company's small size ($51M), high debt ($25M), negative cash flow (-$5M) and its likely need for more capital (dilution). It has no revenue so cannot yet benefit from higher prices. There has been a bit of insider buying but with the stock down 53% in a year it is very hard for it to attract attention, especially considering the weak balance sheet and need for more capital.