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RED

Red 5 ASX:RED Stock Report

Last Price

AU$0.30

Market Cap

AU$707.0m

7D

13.2%

1Y

62.2%

Updated

08 Aug, 2022

Data

Company Financials +
RED fundamental analysis
Snowflake Score
Valuation4/6
Future Growth6/6
Past Performance0/6
Financial Health1/6
Dividends0/6

RED Stock Overview

Red 5 Limited engages in the exploration, production, and mining of gold deposits and mineral properties in the Philippines and Australia.

Rewards

Trading at 95.1% below our estimate of its fair value

Earnings are forecast to grow 119.64% per year

Risk Analysis

No risks detected for RED from our risk checks.

Red 5 Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Red 5
Historical stock prices
Current Share PriceAU$0.30
52 Week HighAU$0.47
52 Week LowAU$0.17
Beta0.73
1 Month Change30.44%
3 Month Change-13.04%
1 Year Change62.16%
3 Year Change-9.09%
5 Year Change614.29%
Change since IPO-82.86%

Recent News & Updates

Shareholder Returns

REDAU Metals and MiningAU Market
7D13.2%4.5%0.7%
1Y62.2%-13.6%-8.0%

Return vs Industry: RED exceeded the Australian Metals and Mining industry which returned -16.4% over the past year.

Return vs Market: RED exceeded the Australian Market which returned -7.9% over the past year.

Price Volatility

Is RED's price volatile compared to industry and market?
RED volatility
RED Average Weekly Movement8.9%
Metals and Mining Industry Average Movement12.2%
Market Average Movement10.5%
10% most volatile stocks in AU Market17.6%
10% least volatile stocks in AU Market4.6%

Stable Share Price: RED is not significantly more volatile than the rest of Australian stocks over the past 3 months, typically moving +/- 9% a week.

Volatility Over Time: RED's weekly volatility (9%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
1995n/aMark Williamshttps://www.red5limited.com

Red 5 Limited engages in the exploration, production, and mining of gold deposits and mineral properties in the Philippines and Australia. The company holds interests in the Siana Gold project located in the Island of Mindanao, the Philippines; King of the Hills Gold project located in the Eastern Goldfields of Western Australia; and Darlot Gold mine situated in the north-east of Perth in Western Australia. Red 5 Limited was incorporated in 1995 and is based in West Perth, Australia.

Red 5 Fundamentals Summary

How do Red 5's earnings and revenue compare to its market cap?
RED fundamental statistics
Market CapAU$707.03m
Earnings (TTM)-AU$35.58m
Revenue (TTM)AU$155.72m

4.5x

P/S Ratio

-19.9x

P/E Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
RED income statement (TTM)
RevenueAU$155.72m
Cost of RevenueAU$178.98m
Gross Profit-AU$23.26m
Other ExpensesAU$12.32m
Earnings-AU$35.58m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)-0.015
Gross Margin-14.94%
Net Profit Margin-22.85%
Debt/Equity Ratio36.6%

How did RED perform over the long term?

See historical performance and comparison
We’ve recently updated our valuation analysis.

Valuation

Is RED 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-Sales vs Peers

  • Price-To-Sales vs Industry

  • Price-To-Sales 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 RED?

Other financial metrics that can be useful for relative valuation.

RED 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/Revenue5x
Enterprise Value/EBITDA-47.1x
PEG Ration/a

Price to Sales Ratio vs Peers

How does RED's PS Ratio compare to its peers?

RED PS Ratio vs Peers
The above table shows the PS ratio for RED vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPSEstimated GrowthMarket Cap
Peer Average1.9x
WGX Westgold Resources
1.1x14.2%AU$629.9m
ALK Alkane Resources
3.5x4.2%AU$494.3m
SBM St Barbara
1.4x7.4%AU$995.2m
RMS Ramelius Resources
1.6x3.7%AU$936.8m
RED Red 5
4.5x56.0%AU$707.0m

Price-To-Sales vs Peers: RED is expensive based on its Price-To-Sales Ratio (4.5x) compared to the peer average (1.9x).


Price to Earnings Ratio vs Industry

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

Price-To-Sales vs Industry: RED is good value based on its Price-To-Sales Ratio (4.5x) compared to the Australian Metals and Mining industry average (43.2x)


Price to Sales Ratio vs Fair Ratio

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

RED PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio4.5x
Fair PS Ratio3.1x

Price-To-Sales vs Fair Ratio: RED is expensive based on its Price-To-Sales Ratio (4.5x) compared to the estimated Fair Price-To-Sales Ratio (3.1x).


Share Price vs Fair Value

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

Below Fair Value: RED (A$0.3) is trading below our estimate of fair value (A$6.18)

Significantly Below Fair Value: RED 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: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.


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Future Growth

How is Red 5 forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

6/6

Future Growth Score 6/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


119.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RED is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.8%).

Earnings vs Market: RED is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: RED is expected to become profitable in the next 3 years.

Revenue vs Market: RED's revenue (56% per year) is forecast to grow faster than the Australian market (5.7% per year).

High Growth Revenue: RED's revenue (56% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: RED's Return on Equity is forecast to be high in 3 years time (20.6%)


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Past Performance

How has Red 5 performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


54.1%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: RED is currently unprofitable.

Growing Profit Margin: RED is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: RED is unprofitable, but has reduced losses over the past 5 years at a rate of 54.1% per year.

Accelerating Growth: Unable to compare RED's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: RED is unprofitable, making it difficult to compare its past year earnings growth to the Metals and Mining industry (57.3%).


Return on Equity

High ROE: RED has a negative Return on Equity (-17.55%), as it is currently unprofitable.


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Financial Health

How is Red 5's financial position?

Financial Health Score

1/6

Financial Health Score 1/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Stable Cash Runway

  • Forecast Cash Runway

Financial Position Analysis

Short Term Liabilities: RED's short term assets (A$65.2M) do not cover its short term liabilities (A$65.8M).

Long Term Liabilities: RED's short term assets (A$65.2M) do not cover its long term liabilities (A$121.8M).


Debt to Equity History and Analysis

Debt Level: RED's net debt to equity ratio (29.2%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if RED's debt to equity ratio has reduced over the past 5 years.


Balance Sheet


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Insufficient data to determine if RED has enough cash runway based on its current free cash flow.

Forecast Cash Runway: Insufficient data to determine if RED has enough cash runway if its free cash flow continues to grow or shrink based on historical rates.


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Dividend

What is Red 5 current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Cash Flow Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate RED's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate RED's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if RED's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if RED's dividend payments have been increasing.


Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as RED has not reported any payouts.


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Management

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

6.7yrs

Average management tenure


CEO

Mark Williams

8.33yrs

Tenure

AU$974,421

Compensation

Mr. Mark James Williams, Dip CSM Mining, GAICD, has been the Managing Director of Red 5 Limited since April 15, 2014. Mr. Williams has been an Executive Director of Red 5 Limited since January 16, 2014. He...


CEO Compensation Analysis

Compensation vs Market: Mark's total compensation ($USD671.74K) is about average for companies of similar size in the Australian market ($USD791.44K).

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


Leadership Team

Experienced Management: RED's management team is seasoned and experienced (6.7 years average tenure).


Board Members

Experienced Board: RED'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: RED 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

Red 5 Limited's employee growth, exchange listings and data sources


Key Information

  • Name: Red 5 Limited
  • Ticker: RED
  • Exchange: ASX
  • Founded: 1995
  • Industry: Gold
  • Sector: Materials
  • Implied Market Cap: AU$707.032m
  • Shares outstanding: 2.36b
  • Website: https://www.red5limited.com

Location

  • Red 5 Limited
  • 35 Ventnor Avenue
  • Level 2
  • West Perth
  • Western Australia
  • 6005
  • Australia

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/08/08 00:00
End of Day Share Price2022/08/08 00:00
Earnings2021/12/31
Annual Earnings2021/06/30


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.