Update shared on 06 Dec 2025
Fair value Increased 2.52%Analysts have raised their price target for Mineral Resources by approximately $1.15 per share, citing slightly higher long term revenue growth expectations, a notable uplift in forecast profit margins, and a lower projected future price to earnings multiple that together support a modestly higher fair value estimate.
What's in the News
- Mineral Resources has reportedly launched a sale process for its Bald Hill lithium mine to help pay down debt, exploring both full and partial stake divestment options (Key Developments).
- Standard Chartered and Argonaut Securities are running the Bald Hill sale process, while JPMorgan continues to advise Mineral Resources more broadly (Key Developments).
- Potential buyers are expected to include downstream battery materials players such as Korea's LG Chemical and Japan's Mitsubishi, which are described as well placed to acquire a strategic stake (Key Developments).
- The Bald Hill mine has been in care and maintenance since late last year after a period of depressed lithium prices. The company had previously considered, but not completed, sales of other assets such as the Wodgina mine (Key Developments).
- Mineral Resources has faced pressure to reduce leverage after a A$904 million annual loss and A$5,400 million of net debt. A recent iron ore price rally has reportedly eased the urgency of further mine sales (Key Developments).
Valuation Changes
- The fair value estimate has risen slightly to A$46.58 per share from A$45.43 per share, implying a modest uplift in the intrinsic valuation.
- The discount rate has increased marginally to 8.91 percent from 8.79 percent, reflecting a slightly higher required return on capital.
- The revenue growth assumption has risen slightly to about 7.67 percent from 7.21 percent, indicating a modestly more optimistic long term growth outlook.
- The net profit margin forecast has increased significantly to about 10.21 percent from 7.45 percent, driving a substantial portion of the higher fair value estimate.
- The future P/E multiple has fallen materially to about 20.7x from 27.9x, suggesting a lower valuation multiple being applied to future earnings.
Disclaimer
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