Cloudbreak Discovery is a UK based mining company with operations in Canada.

Overview

Cloudbreak Discovery Plc (LSE: CDL) is a UK based mining business which deal in Gold, Copper, Zinc & Silver within Canada. At this moment in time, they don't have mining infrastructure set up, hence the low market cap of just £8m, but they once they do, the stock could easily fly way higher. They do have some ownerships of sites with a lot of potential minerals though. Cloudbreak is similar to Kodal Minerals, which saw a huge explosion throughout 2020/2021. Clouldbreak could easily be next, if they start mining operations. In total the rough estimation of metals are worth about £5bn within their sites, just your issue comes with permits, approval and infrastructure.

Financials

The total market cap for Cloudbreak is about £7.5m. Because Couldbreak has yet to start operations on any of its mining facilities, there is no revenue to post, only a loss of £950,000. However, the balance sheet looks okay. Total assets sit at £6.81m with cash making up £1.28m and investments making up £4.35m. Total liabilities are tiny at just £900k, leaving Cloudbreak net positive £5.29m.

Technicals

The company went public in June 2021 at a price of 0.045P meaning at current the stock is down around 60%. Despite this, since November 2021 the stock has been Able to find a base at about 0.015P. This is where support sits for the stock. A break below here could take the shares down towards 0.010P. That being said, to the upside initial targets/resistance are 0.020P followed by 0.0255P then 0.0355P.  The downside risk is about 16% with the upside potential being about 94%.

Summary

Overall Cloudbreak could be a good share over the medium term, and especially over the long term. Mineral mining will continue to happen and if Cloudbreak get any form of rights on their explorations then the share price will just rocket. The R/R is also worth to it, with a near 5.8/1 upside potential. This does come with its risks though as it is a real definition of a penny stock and it could swing in large moves if institutions get ahold of it so its important that stop losses and risk management is in place. Their website is here.