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FAR: New Long Term Mining Contracts Will Drive Stronger Future Returns

Population Growth And Energy Transition Will Drive Mineral Drilling

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FAR
AnalystHighTarget
Not Invested
Published 27 Jul 2025

Update shared on 12 Dec 2025

Fair value Decreased 21%
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AnalystHighTarget's Fair Value
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1Y
6.6%
7D
-1.6%

Analysts have lowered their price target for Foraco International by approximately 21 percent to 3.75 dollars. They cite a slightly higher perceived risk profile, modestly softer long term revenue growth assumptions, and a marginally lower projected profit margin and valuation multiple.

What's in the News

  • Secured two long-term drilling contracts with Tier One gold miners in Nevada, United States, with a combined value exceeding USD 60 million, covering surface coring, deep directional drilling, and reverse circulation services and ramping up through the first quarter of 2026 (Key Developments)
  • Awarded three long-term contracts with Tier One mining customers in Canada and Chile, with an expected combined value of about USD 150 million, extending existing Canadian projects for another three years and adding significant new work in Chile (Key Developments)
  • Completed a share repurchase of 999,000 shares, representing 1.01 percent of outstanding shares, for a total of CAD 2.04 million under the buyback program announced on September 27, 2024 (Key Developments)
  • Executed an additional buyback tranche of 56,200 shares, representing 0.06 percent of outstanding shares, for CAD 0.12 million under the buyback program announced on September 11, 2025 (Key Developments)

Valuation Changes

  • Fair Value Estimate has fallen significantly, decreasing from 4.75 dollars to 3.75 dollars per share.
  • Discount Rate has risen moderately, increasing from approximately 8.90 percent to about 9.56 percent, reflecting a higher perceived risk profile.
  • Revenue Growth has been revised slightly lower, from about 14.23 percent to roughly 14.02 percent annually.
  • Net Profit Margin has edged down, moving from approximately 13.45 percent to about 12.97 percent in forward projections.
  • Future P/E multiple has been trimmed, declining from roughly 8.07 times earnings to about 7.13 times earnings.

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