Executive Summary
Orica Limited manufactures and sells commercial explosives and blasting systems to the mining, quarrying, oil and gas, and construction markets in Australia, the United States, Canada, and internationally. More Details
Rewards
Risk Analysis
Snowflake Analysis
Reasonable growth potential and fair value.
Similar Companies
Share Price & News
How has Orica's share price performed over time and what events caused price changes?
Latest Share Price and Events
Stable Share Price: ORI is not significantly more volatile than the rest of Australian stocks over the past 3 months, typically moving +/- 6% a week.
Volatility Over Time: ORI's weekly volatility (6%) has been stable over the past year.
Market Performance
7 Day Return
-1.1%
ORI
-5.2%
AU Chemicals
-1.1%
AU Market
1 Year Return
-14.8%
ORI
1.5%
AU Chemicals
35.1%
AU Market
Return vs Industry: ORI underperformed the Australian Chemicals industry which returned 1.9% over the past year.
Return vs Market: ORI underperformed the Australian Market which returned 35.2% over the past year.
Shareholder returns
| ORI | Industry | Market | |
|---|---|---|---|
| 7 Day | -1.1% | -5.2% | -1.1% |
| 30 Day | -4.3% | -7.8% | -1.0% |
| 90 Day | -9.8% | -6.1% | 2.4% |
| 1 Year | -13.2%-14.8% | 2.5%1.5% | 39.5%35.1% |
| 3 Year | -17.7%-23.4% | -25.1%-28.4% | 30.1%14.6% |
| 5 Year | 10.9%-2.9% | -7.3%-15.9% | 62.2%30.9% |
Long-Term Price Volatility Vs. Market
How volatile is Orica's share price compared to the market and industry in the last 5 years?
Simply Wall St News
1 week ago | Simply Wall St
Are Orica Limited's (ASX:ORI) Fundamentals Good Enough to Warrant Buying Given The Stock's Recent Weakness?3 weeks ago | Simply Wall St
Would Shareholders Who Purchased Orica's (ASX:ORI) Stock Three Years Be Happy With The Share price Today?1 month ago | Simply Wall St
Orica (ASX:ORI) Could Be Struggling To Allocate CapitalValuation
Is Orica 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: ORI (A$13.8) is trading below our estimate of fair value (A$30.99)
Significantly Below Fair Value: ORI is trading below fair value by more than 20%.
Price To Earnings Ratio
PE vs Industry: ORI is poor value based on its PE Ratio (70.2x) compared to the Australian Chemicals industry average (33.9x).
PE vs Market: ORI is poor value based on its PE Ratio (70.2x) compared to the Australian market (20.2x).
Price to Earnings Growth Ratio
PEG Ratio: ORI is poor value based on its PEG Ratio (2x)
Price to Book Ratio
PB vs Industry: ORI is good value based on its PB Ratio (1.8x) compared to the AU Chemicals industry average (3.3x).
Future Growth
How is Orica forecast to perform in the next 1 to 3 years based on estimates from 12 analysts?
35.3%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: ORI's forecast earnings growth (35.3% per year) is above the savings rate (1.9%).
Earnings vs Market: ORI's earnings (35.3% per year) are forecast to grow faster than the Australian market (12.6% per year).
High Growth Earnings: earnings are expected to grow significantly over the next 3 years.
Revenue vs Market: ORI's revenue (5.1% per year) is forecast to grow faster than the Australian market (4.8% per year).
High Growth Revenue: ORI's revenue (5.1% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: ORI's Return on Equity is forecast to be low in 3 years time (9.5%).
Past Performance
How has Orica performed over the past 5 years?
24.6%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: ORI has a large one-off loss of A$103.5M impacting its March 31 2021 financial results.
Growing Profit Margin: ORI's current net profit margins (1.5%) are lower than last year (6.3%).
Past Earnings Growth Analysis
Earnings Trend: ORI has become profitable over the past 5 years, growing earnings by 24.6% per year.
Accelerating Growth: ORI's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.
Earnings vs Industry: ORI had negative earnings growth (-78.9%) over the past year, making it difficult to compare to the Chemicals industry average (18.4%).
Return on Equity
High ROE: ORI's Return on Equity (2.8%) is considered low.
Financial Health
How is Orica's financial position?
Financial Position Analysis
Short Term Liabilities: ORI's short term assets (A$2.6B) exceed its short term liabilities (A$1.5B).
Long Term Liabilities: ORI's short term assets (A$2.6B) do not cover its long term liabilities (A$3.5B).
Debt to Equity History and Analysis
Debt Level: ORI's debt to equity ratio (86%) is considered high.
Reducing Debt: ORI's debt to equity ratio has increased from 84.4% to 86% over the past 5 years.
Debt Coverage: ORI's debt is not well covered by operating cash flow (12%).
Interest Coverage: ORI's interest payments on its debt are well covered by EBIT (4.1x coverage).
Balance Sheet
Dividend
What is Orica current dividend yield, its reliability and sustainability?
2.39%
Current Dividend Yield
Dividend Yield vs Market
Notable Dividend: ORI's dividend (2.39%) is higher than the bottom 25% of dividend payers in the Australian market (2.08%).
High Dividend: ORI's dividend (2.39%) is low compared to the top 25% of dividend payers in the Australian market (5.21%).
Stability and Growth of Payments
Stable Dividend: ORI's dividend payments have been volatile in the past 10 years.
Growing Dividend: ORI's dividend payments have fallen over the past 10 years.
Current Payout to Shareholders
Dividend Coverage: With its high payout ratio (122.1%), ORI's dividend payments are not well covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: ORI's dividends in 3 years are forecast to be covered by earnings (55.2% payout ratio).
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
2.6yrs
Average management tenure
CEO
Sanjeev Kumar Gandhi (54 yo)
0.083
Tenure
AU$1,431,107
Compensation
Mr. Sanjeev Kumar Gulab Gandhi, BEng (Chemical Engineering), MBA, has been Managing Director, Chief Executive Officer and Director at Orica Limited since April 01, 2021. Mr. Gandhi served as President of A...
CEO Compensation Analysis
Compensation vs Market: Sanjeev Kumar's total compensation ($USD1.11M) is below average for companies of similar size in the Australian market ($USD1.78M).
Compensation vs Earnings: Insufficient data to compare Sanjeev Kumar's compensation with company performance.
Leadership Team
Experienced Management: ORI's management team is considered experienced (2.6 years average tenure).
Board Members
Experienced Board: ORI's board of directors are considered experienced (4.1 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 not been meaningfully diluted in the past year.
Top Shareholders
Company Information
Orica Limited's company bio, employee growth, exchange listings and data sources
Key Information
- Name: Orica Limited
- Ticker: ORI
- Exchange: ASX
- Founded: 1874
- Industry: Commodity Chemicals
- Sector: Materials
- Market Cap: AU$5.616b
- Shares outstanding: 406.92m
- Website: https://www.orica.com
Number of Employees
Location
- Orica Limited
- 1 Nicholson Street
- East Melbourne
- Victoria
- 3002
- Australia
Listings
Biography
Orica Limited manufactures and sells commercial explosives and blasting systems to the mining, quarrying, oil and gas, and construction markets in Australia, the United States, Canada, and internationally....
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2021/05/15 08:01 |
| End of Day Share Price | 2021/05/14 00:00 |
| Earnings | 2021/03/31 |
| Annual Earnings | 2020/09/30 |
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.