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Investing in stocks inevitably means buying into some companies that perform poorly. But the last three years have been particularly tough on longer term Antipa Minerals Limited (ASX:AZY) shareholders. Sadly for them, the share price is down 61% in that time. Shareholders have had an even rougher run lately, with the share price down 35% in the last 90 days.
Check out our latest analysis for Antipa Minerals
Antipa Minerals recorded just AU$75,786 in revenue over the last twelve months, which isn't really enough for us to consider it to have a proven product. You have to wonder why venture capitalists aren't funding it. So it seems shareholders are too busy dreaming about the progress to come than dwelling on the current (lack of) revenue. For example, investors may be hoping that Antipa Minerals finds some valuable resources, before it runs out of money.
As a general rule, if a company doesn't have much revenue, and it loses money, then it is a high risk investment. You should be aware that there is always a chance that this sort of company will need to issue more shares to raise money to continue pursuing its business plan. While some such companies go on to make revenue, profits, and generate value, others get hyped up by hopeful naifs before eventually going bankrupt. It certainly is a dangerous place to invest, as Antipa Minerals investors might realise.
Antipa Minerals had cash in excess of all liabilities of just AU$3.5m when it last reported (December 2018). So if it hasn't remedied the situation already, it will almost certainly have to raise more capital soon. That probably explains why the share price is down 27% per year, over 3 years. You can click on the image below to see (in greater detail) how Antipa Minerals's cash levels have changed over time.
In reality it's hard to have much certainty when valuing a business that has neither revenue or profit. What if insiders are ditching the stock hand over fist? I'd like that just about as much as I like to drink milk and fruit juice mixed together. It costs nothing but a moment of your time to see if we are picking up on any insider selling.
What about the Total Shareholder Return (TSR)?
We've already covered Antipa Minerals's share price action, but we should also mention its total shareholder return (TSR). Arguably the TSR is a more complete return calculation because it accounts for the value of dividends (as if they were reinvested), along with the hypothetical value of any discounted capital that have been offered to shareholders. Antipa Minerals hasn't been paying dividends, but its TSR of -61% exceeds its share price return of -61%, implying it has either spun-off a business, or raised capital at a discount; thereby providing additional value to shareholders.