Hi there,
These are both speculative and high risk plays. Both companies enjoyed boom and bust cycles after the clean tech and carbon credit crazes died post-2021. Neither are profitable and that means they need to either issue debt or shares to grow. In Clean Tech's case, they aren't even generating revenue so that will lead to future raises. In today's environment, that is a problem because debt is no longer cheap and access to capital for pre-revenue/profitable companies is difficult. THat means, they are most likely to rely on capital raises.
At least STRR is generating revenue ($1.2M in 2021, $1.8M in 2022) but that growth has stagnated. In fact, they are looking at closer to 2021 revenue in Fiscal 2023 than 2022. So negative growth like that will certainly hit a small cap like STRR who doesn't really have a long history of execution. However, recent quarters have improved as it looks like their minnning assets are operating more efficiently which is leading to more royalties.
IMO, STRR is a little more interesting here because Cenovus Energy bought 30% of "Green Star" and the subsidiary and will now operate as a joint venture between AEM and CVE - so having strong strategic partners like this makes it more appealing. It is worth noting that based on the investment of CVE, Green Star is now valued at 82M and STRR is only trading at a market cap of 29M despite the fact it owns a good chunk of that joint venture. Green Star is pre-revenue, but it has a clear path to revenue generation beginning in 2024.
Leaving their Carbon Capture business aside, I am also a big fan of streaming companies in general as they provide exposure to precious metals without the burden of CAPEX. Copperstone royalties are expected to come online in Fiscal 2025 at which point revenue is expected to spit to ~7M - which...still isn't a whole lot. That said, this is a very early stage streaming company.
All in all, both are speculative but in my opinion, Star's business model is further along and it is easier to see a path towards profitability with that one. Just be mindful that small caps could take years before truly fulfilling their potential.
Mat
