New Age Metals (CVE:NAM) Is In A Good Position To Deliver On Growth Plans
There's no doubt that money can be made by owning shares of unprofitable businesses. By way of example, New Age Metals...
There's no doubt that money can be made by owning shares of unprofitable businesses. By way of example, New Age Metals (CVE:NAM) has seen its share price rise 493% over the last year, delighting many shareholders. Nonetheless, only a fool would ignore the risk that a loss making company burns through its cash too quickly. Given its strong share price performance, we think it's worthwhile for New Age Metals shareholders to consider whether its cash burn is concerning. For the purpose of this article, we'll define cash burn as the amount of cash the company is spending each year to fund its growth (also called its negative free cash flow).
Let's start with an examination of the business' cash, relative to its cash burn. We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free. When Might New Age Metals Run Out Of Money? You can calculate a company's cash runway by dividing the amount of cash it has by the rate at which it is spending that cash. When New Age Metals last reported its October 2025 balance sheet in December 2025, it had zero debt and cash worth CA$6.8m. Looking at the last year, the company burnt through CA$2.4m. Therefore, from October 2025 it had 2.9 years of cash runway.
That's decent, giving the company a couple years to develop its business. You can see how its cash balance has changed over time in the image below. TSXV:NAM Debt to Equity History December 30th 2025 See our latest analysis for New Age Metals How Is New Age Metals' Cash Burn Changing Over Time? Because New Age Metals isn't currently generating revenue, we consider it an early-stage business. So while we can't look to sales to understand growth, we can look at how the cash burn is changing to understand how expenditure is trending over time. In fact, it ramped its spending strongly over the last year, increasing cash burn by 102%.
It's fair to say that sort of rate of increase cannot be maintained for very long, without putting pressure on the balance sheet. Admittedly, we're a bit cautious of New Age Metals due to its lack of significant operating revenues. We prefer most of the stocks on this list of stocks that analysts expect to grow. How Hard Would It Be For New Age Metals To Raise More Cash For Growth? While New Age Metals does have a solid cash runway, its cash burn trajectory may have some shareholders thinking ahead to when the company may need to raise more cash. Generally speaking, a listed business can raise new cash through issuing shares or taking on debt.
Many companies end up issuing new shares to fund future growth. By comparing a company's annual cash burn to its total market capitalisation, we can estimate roughly how many shares it would have to issue in order to run the company for another year (at the same burn rate). Story Continues New Age Metals has a market capitalisation of CA$32m and burnt through CA$2.4m last year, which is 7.4% of the company's market value. That's a low proportion, so we figure the company would be able to raise more cash to fund growth, with a little dilution, or even to simply borrow some money. Is New Age Metals' Cash Burn A Worry?
As you can probably tell by now, we're not too worried about New Age Metals' cash burn. For example, we think its cash runway suggests that the company is on a good path. While we must concede that its increasing cash burn is a bit worrying, the other factors mentioned in this article provide great comfort when it comes to the cash burn. Considering all the factors discussed in this article, we're not overly concerned about the company's cash burn, although we do think shareholders should keep an eye on how it develops. Separately, we looked at different risks affecting the company and spotted 4 warning signs for New Age Metals (of which 3 are a bit concerning!) you should know about.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies, and this list of stocks growth stocks (according to analyst forecasts) Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation.
We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.