ASX:IGO

Stock Analysis Report

Independence Group

Executive Summary

Independence Group NL operates as a mining and exploration company in Australia.

Rewards

Trading at 50.1% below its fair value

Earnings are forecast to grow 23.07% per year

Earnings grew by 44.4% over the past year

Risk Analysis

Unstable dividend track record



Snowflake Analysis

Solid track record with excellent balance sheet and pays a dividend.


Similar Companies

Share Price & News

How has Independence Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: IGO has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

1.4%

IGO

-1.8%

AU Metals and Mining

-2.0%

AU Market


1 Year Return

55.6%

IGO

20.1%

AU Metals and Mining

16.7%

AU Market

Return vs Industry: IGO exceeded the Australian Metals and Mining industry which returned 20.1% over the past year.

Return vs Market: IGO exceeded the Australian Market which returned 16.7% over the past year.


Shareholder returns

IGOIndustryMarket
7 Day1.4%-1.8%-2.0%
30 Day-7.8%-1.3%0.1%
90 Day-3.1%-1.2%0.4%
1 Year58.2%55.6%28.9%20.1%22.5%16.7%
3 Year42.3%38.2%53.6%32.6%35.4%16.8%
5 Year51.5%43.6%105.1%56.6%60.6%24.4%

Price Volatility Vs. Market

How volatile is Independence Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Independence Group undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: IGO (A$5.93) is trading below our estimate of fair value (A$11.87)

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


Price To Earnings Ratio

PE vs Industry: IGO is poor value based on its PE Ratio (46x) compared to the Metals and Mining industry average (13.4x).

PE vs Market: IGO is poor value based on its PE Ratio (46x) compared to the Australian market (18.6x).


Price to Earnings Growth Ratio

PEG Ratio: IGO is poor value based on its PEG Ratio (2x)


Price to Book Ratio

PB vs Industry: IGO is overvalued based on its PB Ratio (1.9x) compared to the AU Metals and Mining industry average (1.4x).


Next Steps

Future Growth

How is Independence Group forecast to perform in the next 1 to 3 years based on estimates from 12 analysts?

23.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: IGO's forecast earnings growth (23.1% per year) is above the savings rate (1.1%).

Earnings vs Market: IGO's earnings (23.1% per year) are forecast to grow faster than the Australian market (9.4% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: IGO's revenue (4.4% per year) is forecast to grow faster than the Australian market (3.6% per year).

High Growth Revenue: IGO's revenue (4.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: IGO's Return on Equity is forecast to be low in 3 years time (9.5%).


Next Steps

Past Performance

How has Independence Group performed over the past 5 years?

3.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: IGO has high quality earnings.

Growing Profit Margin: IGO's current net profit margins (9.7%) are higher than last year (6.8%).


Past Earnings Growth Analysis

Earnings Trend: IGO's earnings have grown by 3.1% per year over the past 5 years.

Accelerating Growth: IGO's earnings growth over the past year (44.4%) exceeds its 5-year average (3.1% per year).

Earnings vs Industry: IGO earnings growth over the past year (44.4%) exceeded the Metals and Mining industry 7.8%.


Return on Equity

High ROE: IGO's Return on Equity (4.1%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Independence Group's financial position?


Financial Position Analysis

Short Term Liabilities: IGO's short term assets (A$494.2M) exceed its short term liabilities (A$111.3M).

Long Term Liabilities: IGO's short term assets (A$494.2M) exceed its long term liabilities (A$229.9M).


Debt to Equity History and Analysis

Debt Level: IGO's debt to equity ratio (4.6%) is considered satisfactory.

Reducing Debt: IGO's debt to equity ratio has increased from 3.9% to 4.6% over the past 5 years.

Debt Coverage: IGO's debt is well covered by operating cash flow (440.1%).

Interest Coverage: IGO's interest payments on its debt are well covered by EBIT (21.4x coverage).


Balance Sheet

Inventory Level: IGO has a high level of physical assets or inventory.

Debt Coverage by Assets: IGO's debt is covered by short term assets (assets are 5.8x debt).


Next Steps

Dividend

What is Independence Group's current dividend yield, its reliability and sustainability?

2.70%

Current Dividend Yield


Dividend Yield vs Market

company2.7%marketbottom25%2.4%markettop25%5.6%industryaverage4.6%forecastin3Years2.4%

Current dividend yield vs market & industry

Notable Dividend: IGO's dividend (2.7%) is higher than the bottom 25% of dividend payers in the Australian market (2.44%).

High Dividend: IGO's dividend (2.7%) is low compared to the top 25% of dividend payers in the Australian market (5.59%).


Stability and Growth of Payments

Stable Dividend: IGO's dividend payments have been volatile in the past 10 years.

Growing Dividend: IGO's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (77.6%), IGO's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: IGO's dividends in 3 years are forecast to be well covered by earnings (39% payout ratio).


Next Steps

Management

What is the CEO of Independence Group's salary, the management and board of directors tenure and is there insider trading?

2.9yrs

Average management tenure


CEO

Peter J. Bradford (60yo)

5.8yrs

Tenure

AU$1,784,602

Compensation

Mr. Peter J. L. Bradford, B.App.Sc., Extractive Metallurgy, FAusIMM, MSMME, MAIC, has been the Chief Executive Officer and Managing Director of Independence Group NL since March 17, 2014. Mr. Bradford serv ...


CEO Compensation Analysis

Compensation vs Market: Peter J.'s total compensation ($USD1.22M) is about average for companies of similar size in the Australian market ($USD1.38M).

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


Management Age and Tenure

2.9yrs

Average Tenure

Experienced Management: IGO's management team is considered experienced (2.9 years average tenure).


Board Age and Tenure

5.0yrs

Average Tenure

64yo

Average Age

Experienced Board: IGO's board of directors are considered experienced (5 years average tenure).


Insider Trading

Insider Buying: IGO insiders have only sold shares in the past 3 months.


Recent Insider Transactions

BuyAU$13,301,18629 Oct 19
New York Life Investment Management LLC
EntityCompany
Shares2,346,761
Max PriceAU$5.67
SellAU$18,769,91729 Oct 19
New York Life Investment Management LLC
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Shares3,212,897
Max PriceAU$5.84
SellAU$79,840,39603 Oct 19
New York Life Investment Management LLC
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Shares16,938,456
Max PriceAU$4.71
BuyAU$76,445,28603 Oct 19
New York Life Investment Management LLC
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Shares16,089,949
Max PriceAU$4.75
SellAU$20,365,97516 Sep 19
Free CI Pty Ltd
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Shares4,080,106
Max PriceAU$5.00
SellAU$12,845,03716 Sep 19
Xni Pty Ltd
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Shares2,013,329
Max PriceAU$6.38
SellAU$6,903,28016 Sep 19
Ponton Minerals Pty Ltd
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Shares1,082,019
Max PriceAU$6.38
SellAU$44,051,67416 Sep 19
Yandal Investments Pty Ltd
EntityCompany
Shares6,904,652
Max PriceAU$6.38
SellAU$2,279,76011 Sep 19
Peter J. Bradford
EntityIndividual
Role
Chief Executive Officer
MD, CEO & Executive Director
Shares354,000
Max PriceAU$6.44
BuyAU$872,88805 Aug 19
ASB Group Investments Ltd.
EntityCompany
Shares201,264
Max PriceAU$4.34
SellAU$101,671,33505 Aug 19
First Sentier Investors (Australia) IM Ltd
EntityCompany
Shares21,976,066
Max PriceAU$4.76
SellAU$250,83005 Aug 19
ASB Group Investments Ltd.
EntityCompany
Shares55,178
Max PriceAU$4.55
BuyAU$87,535,79005 Aug 19
First Sentier Investors (Australia) IM Ltd
EntityCompany
Shares19,541,876
Max PriceAU$4.54
SellAU$1,626,92302 Jul 19
Dimensional Fund Advisors L.P.
EntityCompany
Shares341,673
Max PriceAU$4.90
BuyAU$1,498,00002 Jul 19
Dimensional Fund Advisors L.P.
EntityCompany
Shares318,903
Max PriceAU$4.97
SellAU$1,111,35918 Mar 19
Dimensional Fund Advisors L.P.
EntityCompany
Shares295,670
Max PriceAU$4.08
BuyAU$2,117,06918 Mar 19
Dimensional Fund Advisors L.P.
EntityCompany
Shares494,324
Max PriceAU$4.78
BuyAU$29,26618 Mar 19
M Fund, Inc. - M International Equity Fund
EntityCompany
Shares7,352
Max PriceAU$3.98

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Peter J. Bradford (60yo)

    MD, CEO & Executive Director

    • Tenure: 5.8yrs
    • Compensation: AU$1.78m
  • Joanne McDonald

    Company Secretary & Head of Corporate Affairs

    • Tenure: 0yrs
    • Compensation: AU$493.90k
  • Scott Steinkrug

    Joint Company Secretary & CFO

    • Tenure: 8.8yrs
    • Compensation: AU$814.27k
  • Ian Sandl

    General Manager of Exploration

    • Tenure: 2.9yrs
    • Compensation: AU$507.88k
  • Andrew Eddowes

    Head of Corporate Development

    • Tenure: 1.8yrs
    • Compensation: AU$533.39k
  • Matt Dusci

    Chief Operating Officer

    • Tenure: 1.9yrs
    • Compensation: AU$963.13k
  • Sam Retallack

    Head of People & Culture

    • Tenure: 0yrs
    • Compensation: AU$560.90k
  • Keith Ashby

    Head of Governance & Risk

    • Tenure: 0yrs
    • Compensation: AU$561.42k
  • Kate Barker

    General Counsel

    • Tenure: 2.9yrs
    • Compensation: AU$498.49k

Board Members

  • Peter J. Bradford (60yo)

    MD, CEO & Executive Director

    • Tenure: 5.8yrs
    • Compensation: AU$1.78m
  • Peter Buck (70yo)

    Independent Non-Executive Director

    • Tenure: 5.2yrs
    • Compensation: AU$135.00k
  • Keith Spence (65yo)

    Non-Executive Director

    • Tenure: 5yrs
    • Compensation: AU$135.00k
  • Neil Warburton (63yo)

    Non-Executive Director

    • Tenure: 4.2yrs
    • Compensation: AU$120.00k
  • Peter Bilbe (69yo)

    Independent Chairman of the Board

    • Tenure: 8.4yrs
    • Compensation: AU$230.00k
  • Kathleen Bozanic

    Independent Non-Executive Director

    • Tenure: 0.2yrs
  • Debra Bakker (53yo)

    Independent Non-Executive Director

    • Tenure: 3yrs
    • Compensation: AU$135.00k

Company Information

Independence Group NL's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Independence Group NL
  • Ticker: IGO
  • Exchange: ASX
  • Founded: 2000
  • Industry: Diversified Metals and Mining
  • Sector: Materials
  • Market Cap: AU$3.415b
  • Shares outstanding: 590.80m
  • Website: https://www.igo.com.au

Location

  • Independence Group NL
  • South Shore Centre
  • Suite 4, Level 5
  • Perth
  • Western Australia
  • 6151
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
IPGD.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 2002
IGOASX (Australian Securities Exchange)YesOrdinary SharesAUAUDJan 2002
IDZDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 2002
IGOCHIA (Chi-X Australia)YesOrdinary SharesAUAUDJan 2002

Biography

Independence Group NL operates as a mining and exploration company in Australia. It operates through Nova Operation and Tropicana Operation segments. The company owns a 100% interest in the Nova project, w ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/06 10:33
End of Day Share Price2019/12/06 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.