Fenix Resources (ASX:FEX) - Share price, News & Analysis

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

FEX (A$0.32) is trading below our estimate of [[fair value]] (A$33.27)

FEX fundamental analysis
Snowflake Score
Valuation	4/6
Future Growth	0/6
Past Performance	4/6
Financial Health	6/6
Dividends	4/6

FEX Stock Overview

Fenix Resources Limited engages in the exploration, development, and mining of mineral tenements.

Rewards

Trading at 99% below our estimate of its fair value

Became profitable this year

Risk Analysis

Unstable dividend track record

Shareholders have been diluted in the past year

Fenix Resources Competitors

Strike Resources

ASX:SRK

AU$35.1m

Red Hill Iron

ASX:RHI

AU$222.8m

BCI Minerals

ASX:BCI

AU$314.2m

Tigers Realm Coal

ASX:TIG

AU$248.3m

Price History & Performance

Summary of all time highs, changes and price drops for Fenix Resources
Historical stock prices
Current Share Price	AU$0.32
52 Week High	AU$0.35
52 Week Low	AU$0.20
Beta	2.66
1 Month Change	12.28%
3 Month Change	8.48%
1 Year Change	6.67%
3 Year Change	344.44%
5 Year Change	966.67%
Change since IPO	-68.00%

Shareholder Returns

	FEX	AU Metals and Mining	AU Market
7D	10.3%	3.7%	1.8%
1Y	6.7%	-6.4%	-5.7%

Return vs Industry: FEX exceeded the Australian Metals and Mining industry which returned -6.4% over the past year.

Return vs Market: FEX exceeded the Australian Market which returned -5.7% over the past year.

Price Volatility

Is FEX's price volatile compared to industry and market?
FEX volatility
FEX Average Weekly Movement	6.9%
Metals and Mining Industry Average Movement	12.3%
Market Average Movement	10.6%
10% most volatile stocks in AU Market	17.7%
10% least volatile stocks in AU Market	4.6%

Stable Share Price: FEX is not significantly more volatile than the rest of Australian stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: FEX's weekly volatility (7%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2007	n/a	Rob Brierley	https://fenixresources.com.au

Fenix Resources Limited engages in the exploration, development, and mining of mineral tenements. It operates through two segments, Iron Ridge Project and Trucking Joint Venture. The company’s flagship property is the 100% owned Iron Ridge Iron Ore project located in Western Australia.

Fenix Resources Fundamentals Summary

How do Fenix Resources's earnings and revenue compare to its market cap?
FEX fundamental statistics
Market Cap	AU$177.52m
Earnings (TTM)	AU$64.24m
Revenue (TTM)	AU$228.98m

2.7x

P/E Ratio

0.8x

P/S Ratio

Is FEX overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
FEX income statement (TTM)
Revenue	AU$228.98m
Cost of Revenue	AU$148.62m
Gross Profit	AU$80.36m
Other Expenses	AU$16.12m
Earnings	AU$64.24m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	0.12
Gross Margin	35.10%
Net Profit Margin	28.06%
Debt/Equity Ratio	0%

How did FEX perform over the long term?

See historical performance and comparison

Dividends

16.4%

Current Dividend Yield

38%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

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

Valuation Score

4/6

Valuation Score 4/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

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

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for FEX. This is calculated by dividing FEX's market cap by their current preferred multiple.
What is FEX's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	AU$177.52m

FEX key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.5x
Enterprise Value/EBITDA	1.5x
PEG Ratio	n/a

Price to Earnings Ratio vs Peers

How does FEX's PE Ratio compare to its peers?

FEX PE Ratio vs Peers

The above table shows the PE ratio for FEX vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	20.5x
SRK Strike Resources	55.6x	n/a	AU$35.1m
RHI Red Hill Iron	1.6x	n/a	AU$222.8m
BCI BCI Minerals	19.1x	-110.6%	AU$314.2m
TIG Tigers Realm Coal	6.6x	n/a	AU$248.3m
FEX Fenix Resources	2.8x	n/a	AU$177.5m

Price-To-Earnings vs Peers: FEX is good value based on its Price-To-Earnings Ratio (2.7x) compared to the peer average (20.5x).

Price to Earnings Ratio vs Industry

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

Price-To-Earnings vs Industry: FEX is good value based on its Price-To-Earnings Ratio (2.7x) compared to the Australian Metals and Mining industry average (10.7x)

Price to Earnings Ratio vs Fair Ratio

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

FEX PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	2.7x
Fair PE Ratio	n/a

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

Share Price vs Fair Value

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

Below Fair Value: FEX (A$0.32) is trading below our estimate of fair value (A$33.27)

Significantly Below Fair Value: FEX is trading below fair value by more than 20%.

Analyst Price Targets

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

Analyst Forecast: Insufficient data to show price forecast.

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Future Growth

How is Fenix Resources forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

-8.5%

Forecasted Materials industry annual growth in earnings

In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Fenix Resources has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.

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Examine whether Fenix Resources is trading at an attractive price based on how much it is expected to earn in the future, and relative to its industry peers and the wider market.
Fenix Resources competitive advantages and company strategy can generally be found in its financial reports archived here.

Past Performance

How has Fenix Resources performed over the past 5 years?

Past Performance Score

4/6

Past Performance Score 4/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

86.4%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: FEX has high quality earnings.

Growing Profit Margin: FEX became profitable in the past.

Past Earnings Growth Analysis

Earnings Trend: FEX has become profitable over the past 5 years, growing earnings by 86.4% per year.

Accelerating Growth: FEX has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: FEX has become profitable in the last year, making it difficult to compare its past year earnings growth to the Metals and Mining industry (54.3%).

Return on Equity

High ROE: FEX's Return on Equity (96.5%) is considered outstanding.

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Financial Health

How is Fenix Resources's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: FEX's short term assets (A$76.2M) exceed its short term liabilities (A$30.0M).

Long Term Liabilities: FEX's short term assets (A$76.2M) exceed its long term liabilities (A$8.8M).

Debt to Equity History and Analysis

Debt Level: FEX is debt free.

Reducing Debt: FEX had no debt 5 years ago.

Debt Coverage: FEX has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: FEX has no debt, therefore coverage of interest payments is not a concern.

Balance Sheet

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Dividend

What is Fenix Resources's current dividend yield, its reliability and sustainability?

Dividend Score

4/6

Dividend Score 4/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

16.41%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: FEX's dividend (16.41%) is higher than the bottom 25% of dividend payers in the Australian market (2.56%).

High Dividend: FEX's dividend (16.41%) is in the top 25% of dividend payers in the Australian market (6.41%)

Stability and Growth of Payments

Stable Dividend: Too early to tell whether FEX's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if FEX's dividend payments are increasing as they only just started paying a dividend.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (38.2%), FEX's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its reasonably low cash payout ratio (43.8%), FEX's dividend payments are well covered by cash flows.

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Management

How experienced are the management team and are they aligned to shareholders interests?

2.1yrs

Average management tenure

CEO

Rob Brierley (56 yo)

3.42yrs

Tenure

AU$613,846

Compensation

Mr. Robert James Shaw Brierley, also known as Rob, BEng(Mining), Grad Dip., GA, has been Managing director of Fenix Resources Limited since March 1, 2019 and its Executive Director since November 21, 2018....

CEO Compensation Analysis

Compensation vs Market: Rob's total compensation ($USD430.50K) is above average for companies of similar size in the Australian market ($USD282.47K).

Compensation vs Earnings: Rob's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: FEX's management team is considered experienced (2.1 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 15.7%.

Data	Last Updated (UTC time)
Company Analysis	2022/08/17 00:00
End of Day Share Price	2022/08/17 00:00
Earnings	2021/12/31
Annual Earnings	2021/06/30