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Companies Like Getchell Gold (CSE:GTCH) Are In A Position To Invest In Growth

Simply Wall St · 2d ago

We can readily understand why investors are attracted to unprofitable companies. Indeed, Getchell Gold (CSE:GTCH) stock is up 224% in the last year, providing strong gains for shareholders. Nonetheless, only a fool would ignore the risk that a loss making company burns through its cash too quickly.

So notwithstanding the buoyant share price, we think it's well worth asking whether Getchell Gold's cash burn is too risky. For the purposes of this article, cash burn is the annual rate at which an unprofitable company spends cash to fund its growth; its negative free cash flow. We'll start by comparing its cash burn with its cash reserves in order to calculate its cash runway.

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Does Getchell Gold Have A Long 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. When Getchell Gold last reported its September 2025 balance sheet in November 2025, it had zero debt and cash worth CA$4.2m. Importantly, its cash burn was CA$2.5m over the trailing twelve months. Therefore, from September 2025 it had roughly 20 months of cash runway. That's not too bad, but it's fair to say the end of the cash runway is in sight, unless cash burn reduces drastically. Depicted below, you can see how its cash holdings have changed over time.

debt-equity-history-analysis
CNSX:GTCH Debt to Equity History December 5th 2025

See our latest analysis for Getchell Gold

How Is Getchell Gold's Cash Burn Changing Over Time?

Getchell Gold didn't record any revenue over the last year, indicating that it's an early stage company still developing its 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. Even though it doesn't get us excited, the 36% reduction in cash burn year on year does suggest the company can continue operating for quite some time. Getchell Gold makes us a little nervous due to its lack of substantial operating revenue. So we'd generally prefer stocks from this list of stocks that have analysts forecasting growth.

How Easily Can Getchell Gold Raise Cash?

Even though it has reduced its cash burn recently, shareholders should still consider how easy it would be for Getchell Gold to raise more cash in the future. Issuing new shares, or taking on debt, are the most common ways for a listed company to raise more money for its business. Many companies end up issuing new shares to fund future growth. By looking at a company's cash burn relative to its market capitalisation, we gain insight on how much shareholders would be diluted if the company needed to raise enough cash to cover another year's cash burn.

Getchell Gold has a market capitalisation of CA$79m and burnt through CA$2.5m last year, which is 3.1% 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 Getchell Gold's Cash Burn A Worry?

It may already be apparent to you that we're relatively comfortable with the way Getchell Gold is burning through its cash. For example, we think its cash burn relative to its market cap suggests that the company is on a good path. Its cash runway wasn't quite as good, but was still rather encouraging! 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. On another note, Getchell Gold has 4 warning signs (and 3 which shouldn't be ignored) we think you should know about.

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