Q: For a short term investment (2/3 years max), do you prefer Equinox or Torex and why?
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5i Research Answer:
EQX is more expensive at 15.5x forward-earnings while TXG is valued at 6.0x forward earnings. Both companies have been volatile over the last year, but while TXG has faced a drawdown, EQX is up nearly 16%. Outlook for EQX is very strong with high growth in revenue and EPS expected over the next two years. TXG forecasts suggest a drawdown in 2024 but growth is expected in 2025 in revenue and EPS. EQX is much more levered than TXG which makes it riskier, but it is also bigger based off market cap to offset some of this risk. We think the decision here is more-so focussed on value vs. growth where EQX has higher growth potential while TXG is a cheaper value play. We think both are buyable at current levels and are solid junior gold miners.