Arafura Rare Earths Limited

ASX:ARU Stock Report

Market Cap: AU$308.0m

Arafura Rare Earths Valuation

Is ARU undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

1/6

Valuation Score 1/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Book vs Peers

  • Price-To-Book vs Industry

  • Price-To-Book vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of ARU when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: Insufficient data to calculate ARU's fair value for valuation analysis.

Significantly Below Fair Value: Insufficient data to calculate ARU's fair value for valuation analysis.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for ARU?

Key metric: As ARU is unprofitable and pre-revenue we use its Price-To-Book Ratio for relative valuation analysis.

The above table shows the Price to Book ratio for ARU. This is calculated by dividing ARU's market cap by their current book value.
What is ARU's PB Ratio?
PB Ratio2.1x
BookAU$144.11m
Market CapAU$308.04m

Price to Book Ratio vs Peers

How does ARU's PB Ratio compare to its peers?

The above table shows the PB ratio for ARU vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PBEstimated GrowthMarket Cap
Peer Average10.2x
WC8 Wildcat Resources
1.2x-4.9%AU$315.3m
DDH DDH1
1x9.6%AU$331.8m
AMI Aurelia Metals
0.9x30.2%AU$287.6m
MAU Magnetic Resources
37.7xn/aAU$333.4m
ARU Arafura Rare Earths
2.1x5.8%AU$308.0m

Price-To-Book vs Peers: ARU is good value based on its Price-To-Book Ratio (2.1x) compared to the peer average (13.3x).

Price to Book Ratio vs Industry

How does ARU's PB Ratio compare vs other companies in the AU Metals and Mining Industry?

16 CompaniesPrice / BookEstimated GrowthMarket Cap
HAS Hastings Technology Metals
0.2x12.6%US$32.32m
JRV Jervois Global
0.1xn/aUS$19.32m
ADN Andromeda Metals
0.2x25.5%US$15.59m
CTO Citigold
0.1xn/aUS$7.80m
ARU 2.1xIndustry Avg. 1.1xNo. of Companies92PB00.81.62.43.24+
16 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Book vs Industry: ARU is expensive based on its Price-To-Book Ratio (2.1x) compared to the Australian Metals and Mining industry average (1.1x).

Price to Book Ratio vs Fair Ratio

What is ARU's PB Ratio compared to its Fair PB Ratio? This is the expected PB Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

ARU PB Ratio vs Fair Ratio.
Fair Ratio
Current PB Ratio2.1x
Fair PB Ration/a

Price-To-Book vs Fair Ratio: Insufficient data to calculate ARU's Price-To-Book Fair Ratio for valuation analysis.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst ARU forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentAU$0.13
AU$0.18
+46.7%
27.2%AU$0.25AU$0.13n/a3
Nov ’25AU$0.15
AU$0.18
+18.3%
27.2%AU$0.25AU$0.13n/a3
Oct ’25AU$0.17
AU$0.17
+2.0%
35.4%AU$0.25AU$0.10n/a3
Sep ’25AU$0.17
AU$0.17
+5.0%
35.4%AU$0.25AU$0.10n/a3
Aug ’25AU$0.17
AU$0.14
-20.6%
25.9%AU$0.17AU$0.10n/a2
Jul ’25AU$0.18
AU$0.24
+35.2%
46.3%AU$0.40AU$0.14n/a3
Jun ’25AU$0.19
AU$0.24
+28.1%
46.3%AU$0.40AU$0.14n/a3
May ’25AU$0.20
AU$0.24
+24.8%
46.3%AU$0.40AU$0.14n/a3
Apr ’25AU$0.20
AU$0.27
+30.1%
35.5%AU$0.40AU$0.19n/a3
Mar ’25AU$0.15
AU$0.20
+29.0%
5.0%AU$0.21AU$0.19n/a2
Feb ’25AU$0.13
AU$0.20
+60.0%
5.0%AU$0.21AU$0.19n/a2
Jan ’25AU$0.17
AU$0.33
+97.0%
35.4%AU$0.44AU$0.21n/a2
Dec ’24AU$0.20
AU$0.47
+139.3%
35.4%AU$0.65AU$0.25n/a3
Nov ’24AU$0.20
AU$0.55
+175.0%
39.3%AU$0.75AU$0.25AU$0.153
Oct ’24AU$0.26
AU$0.60
+130.8%
24.5%AU$0.75AU$0.40AU$0.173
Sep ’24AU$0.24
AU$0.60
+144.9%
24.5%AU$0.75AU$0.40AU$0.173
Aug ’24AU$0.29
AU$0.62
+111.3%
25.4%AU$0.75AU$0.40AU$0.173
Jul ’24AU$0.30
AU$0.69
+126.2%
9.4%AU$0.75AU$0.60AU$0.183
Jun ’24AU$0.35
AU$0.69
+97.1%
9.4%AU$0.75AU$0.60AU$0.193
May ’24AU$0.41
AU$0.69
+68.3%
9.4%AU$0.75AU$0.60AU$0.203
Apr ’24AU$0.49
AU$0.69
+39.4%
9.4%AU$0.75AU$0.60AU$0.203
Mar ’24AU$0.65
AU$0.73
+13.1%
2.0%AU$0.75AU$0.72AU$0.152

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.

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