There’s no doubt that money can be made by owning shares of unprofitable businesses. For example, Elevate Uranium ( ASX:EL8 ) shareholders have done very well over the last year, with the share price soaring by 600%. But while history lauds those rare successes, those that fail are often forgotten; who remembers Pets.com?
In light of its strong share price run, we think now is a good time to investigate how risky Elevate Uranium’s cash burn is. In this report, we will consider the company’s annual negative free cash flow, henceforth referring to it as the ‘cash burn’. The first step is to compare its cash burn with its cash reserves, to give us its ‘cash runway’. How Long Is Elevate Uranium’s Cash Runway?
A company’s cash runway is the amount of time it would take to burn through its cash reserves at its current cash burn rate. In […]
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