ASX:MGX

Stock Analysis Report

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Executive Summary

Mount Gibson Iron Limited, together with its subsidiaries, engages in mining and processing of hematite iron ore in Australia. More Details


Snowflake Analysis

Flawless balance sheet and fair value.


Similar Companies

Share Price & News

How has Mount Gibson Iron's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

-0.7%

MGX

-3.0%

AU Metals and Mining

-0.3%

AU Market


1 Year Return

-5.2%

MGX

8.3%

AU Metals and Mining

-11.1%

AU Market

Return vs Industry: MGX underperformed the Australian Metals and Mining industry which returned 8.3% over the past year.

Return vs Market: MGX exceeded the Australian Market which returned -11.1% over the past year.


Shareholder returns

MGXIndustryMarket
7 Day-0.7%-3.0%-0.3%
30 Day-6.4%-4.9%-4.2%
90 Day18.5%5.3%1.6%
1 Year-1.4%-5.2%13.4%8.3%-7.8%-11.1%
3 Year126.4%93.4%66.9%43.7%17.1%2.1%
5 Year403.8%308.3%148.4%101.3%43.1%13.0%

Price Volatility Vs. Market

How volatile is Mount Gibson Iron's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Mount Gibson Iron undervalued compared to its fair value and its price relative to the market?

9.97x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: MGX (A$0.74) is trading above our estimate of fair value (A$0.67)

Significantly Below Fair Value: MGX is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: MGX is good value based on its PE Ratio (10x) compared to the AU Metals and Mining industry average (11.9x).

PE vs Market: MGX is good value based on its PE Ratio (10x) compared to the Australian market (20.4x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate MGX's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: MGX is good value based on its PB Ratio (1.3x) compared to the AU Metals and Mining industry average (2.2x).


Next Steps

Future Growth

How is Mount Gibson Iron forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

18.1%

Forecasted annual revenue growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if MGX's forecast earnings growth is above the savings rate (2.3%).

Earnings vs Market: Insufficient data to determine if MGX's earnings are forecast to grow faster than the Australian market

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

Revenue vs Market: MGX's revenue (18.1% per year) is forecast to grow faster than the Australian market (4.3% per year).

High Growth Revenue: MGX's revenue (18.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: MGX's Return on Equity is forecast to be low in 3 years time (18%).


Next Steps

Past Performance

How has Mount Gibson Iron performed over the past 5 years?

65.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: MGX has high quality earnings.

Growing Profit Margin: MGX's current net profit margins (19%) are lower than last year (47.8%).


Past Earnings Growth Analysis

Earnings Trend: MGX has become profitable over the past 5 years, growing earnings by 65.3% per year.

Accelerating Growth: MGX's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: MGX had negative earnings growth (-36.6%) over the past year, making it difficult to compare to the Metals and Mining industry average (15.3%).


Return on Equity

High ROE: MGX's Return on Equity (12.6%) is considered low.


Next Steps

Financial Health

How is Mount Gibson Iron's financial position?


Financial Position Analysis

Short Term Liabilities: MGX's short term assets (A$486.7M) exceed its short term liabilities (A$81.1M).

Long Term Liabilities: MGX's short term assets (A$486.7M) exceed its long term liabilities (A$53.0M).


Debt to Equity History and Analysis

Debt Level: MGX is debt free.

Reducing Debt: MGX has no debt compared to 5 years ago when its debt to equity ratio was 0.2%.

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

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


Balance Sheet


Next Steps

Dividend

What is Mount Gibson Iron current dividend yield, its reliability and sustainability?

4.08%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: MGX's dividend (4.08%) is higher than the bottom 25% of dividend payers in the Australian market (2.38%).

High Dividend: MGX's dividend (4.08%) is low compared to the top 25% of dividend payers in the Australian market (5.67%).


Stability and Growth of Payments

Stable Dividend: MGX has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: MGX has only been paying a dividend for 9 years, and since then payments have fallen.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (40.7%), MGX's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: MGX's dividends in 3 years are forecast to be well covered by earnings (25.7% payout ratio).


Next Steps

Management

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

1.9yrs

Average management tenure


CEO

Peter Kerr

1.92yrs

Tenure

AU$991,648

Compensation

Mr. Peter W. Kerr, B.Comm, CA, F.Fin, M.AusIMM, M.AICD., has been the Chief Executive Officer at Mount Gibson Iron Limited since October 1, 2018. He served as the Chief Financial Officer of Mount Gibson Ir ...


CEO Compensation Analysis

Compensation vs Market: Peter's total compensation ($USD695.65K) is about average for companies of similar size in the Australian market ($USD946.54K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Peter Kerr
Chief Executive Officer1.92yrsAU$991.65k0.26%
A$ 2.3m
Gillian Dobson
Chief Financial Officer1.92yrsAU$617.58k0.030%
A$ 260.0k
Mark Mitchell
Chief Operating Officer0.92yrAU$590.83kno data
David Stokes
Company Secretary & General Counsel8.42yrsAU$597.89k0.19%
A$ 1.7m
John Phaceas
Manager of Investor & External Relationsno datano datano data
J. Fitzgerald
Group Financial Controllerno datano datano data

1.9yrs

Average Tenure

Experienced Management: MGX's management team is not considered experienced ( 1.9 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Russell Barwick
Independent Non-Executive Director8.83yrsAU$101.50kno data
Simon Bird
Lead Independent Non-Executive Director6.67yrsAU$109.00k0.0043%
A$ 37.5k
Seng-Hui Lee
Non-Executive Chairman6.58yrsAU$104.63kno data
Alan Stephen Jones
Independent Non-Executive Director14.17yrsAU$101.50k0.026%
A$ 225.4k
Andrew Ferguson
Alternate Director8yrsno datano data
Paul Dougas
Independent Non-Executive Director8.83yrsAU$88.50k0.063%
A$ 550.2k
Rucai Ding
Non-Executive Director0.75yrno datano data

8.0yrs

Average Tenure

53yo

Average Age

Experienced Board: MGX's board of directors are considered experienced (8 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 4.9%.


Top Shareholders

Company Information

Mount Gibson Iron Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Mount Gibson Iron Limited
  • Ticker: MGX
  • Exchange: ASX
  • Founded: 1996
  • Industry: Steel
  • Sector: Materials
  • Market Cap: AU$871.649m
  • Shares outstanding: 1.19b
  • Website: https://www.mtgibsoniron.com.au

Number of Employees


Location

  • Mount Gibson Iron Limited
  • 2 Kings Park Road
  • Level 1
  • West Perth
  • Western Australia
  • 6005
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
MGXASX (Australian Securities Exchange)YesOrdinary SharesAUAUDJan 2002
FWQDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 2002
MTGR.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 2002
MGXCHIA (Chi-X Australia)YesOrdinary SharesAUAUDJan 2002
MTGR.YOTCPK (Pink Sheets LLC)UNSPONSORED ADRUSUSDJan 2012

Biography

Mount Gibson Iron Limited, together with its subsidiaries, engages in mining and processing of hematite iron ore in Australia. It operates in two segments, Extension Hill and Koolan Island. The company pri ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/09/25 20:04
End of Day Share Price2020/09/25 00:00
Earnings2020/06/30
Annual Earnings2020/06/30


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.