What is USGD.CN's Intrinsic value?

American Pacific Mining Corp (USGD.CN) Intrinsic Value Analysis

Executive Summary

As of May 22, 2025, American Pacific Mining Corp's estimated intrinsic value ranges from $0.18 to $0.18 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Dividend Discount Model (Stable) $0.18 -6.9%

Is American Pacific Mining Corp (USGD.CN) undervalued or overvalued?

With the current market price at $0.20, the stock appears to be fairly valued.

Understanding Intrinsic Value

Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate American Pacific Mining Corp's intrinsic value, including:

  1. Dividend Discount Model (DDM): Values the company based on expected future dividend payments

Weighted Average Cost of Capital (WACC)

The cost of capital is a critical factor in valuation models, representing the required return for investors.

WACC Component Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta -0.1 0.31
Cost of equity 3.2% 6.6%
Cost of debt 5.0% 5.0%
Tax rate 25.9% 26.5%
Debt/Equity ratio 0.03 0.03
After-tax WACC 3.2% 6.5%

Valuation Methods

2. Dividend Discount Model (DDM)

The DDM values a company based on its expected future dividend payments. We used two approaches:

Multi-Stage DDM:

  • Current payout ratio: 0.0%
  • Stable payout ratio: 90.0%
  • Growth transition: 5 years
  • Cost of equity: 4.9%
  • Long-term growth rate: 4.0%
  • Fair value: $-3.45 (-1871.4% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 6.6% (Low) to 3.2% (High)
  • Long-term growth rate: 3.0% (Low) to 5.0% (High)
  • Fair value range: $(0) to $1
  • Selected fair value: $0.18 (-6.9% from current price)

Key Financial Metrics

Metric Value
Market Capitalization $43M
Enterprise Value $40M
Trailing P/E 0.00
Forward P/E 0.00
Trailing EV/EBITDA 0.00
Current Dividend Yield 62.96%
Dividend Growth Rate (5Y) 0.00%
Debt-to-Equity Ratio 0.03

Investment Decision Framework

To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:

  1. Forecast Certainty: DCF methods rely on long-term projections, while earnings power value focuses on current normalized earnings
  2. Business Model Alignment: Dividend models are more appropriate for mature companies with established dividend policies
  3. Historical Accuracy: How well each method has predicted fair value historically

Valuation Weight Matrix

Valuation Method Weight Weighted Value
Dividend Discount Model (Stable) 100% $0.03
Weighted Average 100% $0.18

Investment Conclusion

Based on our comprehensive valuation analysis, American Pacific Mining Corp's weighted average intrinsic value is $0.18, which is approximately 6.9% below the current market price of $0.20.

Key investment considerations:

  • Conservative capital structure (Debt/Equity of 0.03)

Given these factors, we believe American Pacific Mining Corp is currently fairly valued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.