Stock Analysis & Valuation Gold By Gold S.A. (ALGLD.PA)

• Previous Close: €4.50
• Sector Valuation Confidence Level: Moderate

Valuation method	Value, €	Upside, %
Artificial intelligence (AI)	595.12	13125
Intrinsic value (DCF)	170.96	3699
Graham-Dodd Method	0.68	-85
Graham Formula	0.56	-87

Strategic Investment Analysis

Company Overview

Gold By Gold SA (ALGLD.PA) is a Paris-based company specializing in the extraction, refining, and trading of precious metals, primarily gold and silver, catering to both individuals and professionals in France. Established in 1997, the company operates a unique business model that includes purchasing and recycling gold and silver items such as jewelry, accessories, dental gold, watches, and ingots. Gold By Gold SA also facilitates online transactions, making it accessible for customers to sell their precious metals. Operating in the Other Precious Metals industry under the Basic Materials sector, the company plays a niche role in the precious metals recycling and trading market. With a market capitalization of approximately €8.5 million, Gold By Gold SA is a small but notable player in France's precious metals landscape, combining traditional refining with modern e-commerce capabilities.

Investment Summary

Gold By Gold SA presents a specialized investment opportunity in the precious metals recycling and trading sector. The company's modest market cap and low beta (-0.155) suggest limited correlation with broader market movements, potentially offering diversification benefits. However, its financials reveal thin margins, with net income of just €36,086 on revenues of €13.67 million, indicating operational inefficiencies or high cost structures. The company maintains a conservative balance sheet with €731,602 in cash and minimal debt (€93,750), providing some financial stability. The dividend yield, though small (€0.03 per share), may appeal to income-focused investors. Risks include exposure to volatile precious metal prices, regulatory changes in recycling practices, and competition from larger refiners. Investors should weigh the niche market positioning against the challenges of scaling profitability.

Competitive Analysis

Gold By Gold SA operates in a highly competitive segment of the precious metals industry, competing with both large-scale refiners and smaller local recyclers. Its competitive advantage lies in its localized focus on the French market and its dual approach of combining traditional refining with online trading platforms, which enhances accessibility for individual sellers. However, the company's small scale limits its ability to achieve economies of scale enjoyed by larger competitors. Its revenue of €13.67 million is dwarfed by multinational refiners, and its net margin of ~0.26% reflects pricing pressures and high operating costs. The company's strength is its agility in serving local customers and professionals who prefer a more personalized service. Yet, it lacks the global supply chain integration and advanced refining technologies of industry leaders. The online recycling component provides a modern touch but faces competition from digital-first platforms. Overall, Gold By Gold SA occupies a niche position, relying on regional expertise rather than cost leadership or technological superiority.

Major Competitors

• Kinross Gold Corporation (KGC): Kinross Gold is a mid-tier gold mining company with global operations, offering scale and diversification that Gold By Gold cannot match. Its strengths include integrated mining and refining capabilities, but it lacks the localized recycling focus of Gold By Gold. Kinross's larger production volumes provide cost advantages, but it is more exposed to mining risks.
• Wheaton Precious Metals Corp. (WPM): Wheaton operates as a streaming company, providing upfront payments for the right to purchase precious metals in the future. Its business model is fundamentally different from Gold By Gold's recycling approach. Wheaton's strengths include high margins and low operational risks, but it does not engage in direct refining or recycling.
• Sibanye Stillwater Limited (SBSW): Sibanye is a major precious metals miner with significant gold and platinum group metals operations. Its strengths lie in vertical integration and large-scale production, but it is geographically distant from Gold By Gold's French market. Sibanye's exposure to mining risks contrasts with Gold By Gold's recycling focus.
• Auriant Mining AB (AUMTF): Auriant is a smaller gold mining and exploration company with operations primarily in Russia. Like Gold By Gold, it is a smaller player but focuses on mining rather than recycling. Its geographic and operational risks are higher, but it offers direct exposure to gold production.