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Galaxy Digital Holdings Ltd. ordinary shares (GLXY)
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Enthusiast Gaming Holdings Inc. (EGLX)
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Lumine Group Inc. (LMN)
well thought of management, a Canadian small cap expected to list on the NASDAQ. You had EGLX in the growth portfolio; recommended it at $7.00 but then eventually sold it. You saw a reason to sell that I didn’t and I paid the price. What am I to look at specifically for GLXY so I don’t repeat the same mistake ? ( Maybe I should just stay away with stocks that have the letters LXY in their ticker ! )
Thanks. Derek
We would first consider LMN to be vastly superior in nearly every respect compared with EGLX. In addition to management, it has the backing of CSU and its acquisition strategy is already proven. The industry is more mature and disciplined. GLXY is a tough comparison though because of how closely it is tied to cryptocurrencies. If cryptos collapse, GLXY is going to suffer no matter what it does. Its destiny is a bit more out of its control vs LMN's. Its sector also makes forecasting far more difficult. Earnings have already seen substantial volatility in the past five years. Both, though, are generating positive cash flow (substantial) whereas EGLX never has. This means less need for capital than EGLX, which should help performance. Nothing is guaranteed of course. But GLXY, at $4B market cap, is already much bigger than EGLX ever was. This, and its cash flow and balance sheet, means its cost of capital is lower, and this can also be an advantage to larger companies.