Aeris Resources (CHIA:AIS) - Share price, News & Analysis

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

AIS (A$0.45) is trading below our estimate of [[fair value]] (A$1.39)

AIS fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	6/6
Past Performance	2/6
Financial Health	6/6
Dividends	0/6

AIS Stock Overview

Aeris Resources Limited, together with its subsidiaries, produces and sells copper, gold, and silver products.

Rewards

Trading at 67.7% below our estimate of its fair value

Earnings are forecast to grow 54.74% per year

Risk Analysis

Highly volatile share price over the past 3 months

Shareholders have been substantially diluted in the past year

Profit margins (7.1%) are lower than last year (10.8%)

Aeris Resources Competitors

Sandfire Resources

ASX:SFR

AU$1.9b

OZ Minerals

ASX:OZL

AU$6.3b

MACA

ASX:MLD

AU$341.7m

Macmahon Holdings

ASX:MAH

AU$315.0m

Price History & Performance

Summary of all time highs, changes and price drops for Aeris Resources
Historical stock prices
Current Share Price	AU$0.45
52 Week High	AU$1.61
52 Week Low	AU$0.064
Beta	1.79
1 Month Change	-1.10%
3 Month Change	-37.28%
1 Year Change	-70.78%
3 Year Change	2.04%
5 Year Change	31.20%
Change since IPO	56.79%

Shareholder Returns

	AIS	AU Metals and Mining	AU Market
7D	5.9%	1.4%	1.0%
1Y	-70.8%	-16.5%	-7.9%

Return vs Industry: AIS underperformed the Australian Metals and Mining industry which returned -18.2% over the past year.

Return vs Market: AIS underperformed the Australian Market which returned -8.5% over the past year.

Price Volatility

Is AIS's price volatile compared to industry and market?
AIS volatility
AIS Average Weekly Movement	179.0%
Metals and Mining Industry Average Movement	12.1%
Market Average Movement	10.6%
10% most volatile stocks in AU Market	17.5%
10% least volatile stocks in AU Market	4.7%

Stable Share Price: AIS is more volatile than 90% of Australian stocks over the past 3 months, typically moving +/- 80% a day.

Volatility Over Time: AIS's weekly volatility has increased from 87% to 179% over the past year.

About the Company

Founded	Employees	CEO	Website
2010	n/a	Willie Labuschagne	https://www.aerisresources.com.au

Aeris Resources Limited, together with its subsidiaries, produces and sells copper, gold, and silver products. The company also explores for copper and gold ores. Its flagship asset is the Cracow Gold Operations located to the north-west of Brisbane, Queensland.

Aeris Resources Fundamentals Summary

How do Aeris Resources's earnings and revenue compare to its market cap?
AIS fundamental statistics
Market Cap	AU$310.93m
Earnings (TTM)	AU$29.47m
Revenue (TTM)	AU$412.68m

10.6x

P/E Ratio

0.8x

P/S Ratio

Is AIS overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
AIS income statement (TTM)
Revenue	AU$412.68m
Cost of Revenue	AU$356.41m
Gross Profit	AU$56.27m
Other Expenses	AU$26.79m
Earnings	AU$29.47m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	0.043
Gross Margin	13.63%
Net Profit Margin	7.14%
Debt/Equity Ratio	0.2%

How did AIS perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

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

Valuation Score

3/6

Valuation Score 3/6

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 AIS?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for AIS. This is calculated by dividing AIS's market cap by their current preferred multiple.
What is AIS's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	AU$310.93m

AIS 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	0.6x
Enterprise Value/EBITDA	2.1x
PEG Ratio	0.2x

Price to Earnings Ratio vs Peers

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

AIS PE Ratio vs Peers

The above table shows the PE ratio for AIS vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	10.2x
SFR Sandfire Resources	9.6x	-8.7%	AU$1.9b
OZL OZ Minerals	11.9x	1.1%	AU$6.3b
MLD MACA	11x	22.4%	AU$341.7m
MAH Macmahon Holdings	8.4x	13.7%	AU$315.0m
AIS Aeris Resources	10.6x	54.7%	AU$310.9m

Price-To-Earnings vs Peers: AIS is expensive based on its Price-To-Earnings Ratio (10.6x) compared to the peer average (10.2x).

Price to Earnings Ratio vs Industry

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

Price-To-Earnings vs Industry: AIS is expensive based on its Price-To-Earnings Ratio (10.6x) compared to the Australian Metals and Mining industry average (9.4x)

Price to Earnings Ratio vs Fair Ratio

What is AIS'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.

AIS PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	10.6x
Fair PE Ratio	19.7x

Price-To-Earnings vs Fair Ratio: AIS is good value based on its Price-To-Earnings Ratio (10.6x) compared to the estimated Fair Price-To-Earnings Ratio (19.7x).

Share Price vs Fair Value

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

Below Fair Value: AIS (A$0.45) is trading below our estimate of fair value (A$1.39)

Significantly Below Fair Value: AIS 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, but there are not enough analysts covering the stock to determine statistical confidence in agreement.

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Future Growth

How is Aeris Resources 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

54.7%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: AIS's forecast earnings growth (54.7% per year) is above the savings rate (1.8%).

Earnings vs Market: AIS's earnings (54.7% per year) are forecast to grow faster than the Australian market (6.3% per year).

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

Revenue vs Market: AIS's revenue (22.3% per year) is forecast to grow faster than the Australian market (5.7% per year).

High Growth Revenue: AIS's revenue (22.3% per year) is forecast to grow faster than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: AIS's Return on Equity is forecast to be high in 3 years time (28.6%)

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Past Performance

How has Aeris Resources performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

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

30.1%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: AIS has high quality earnings.

Growing Profit Margin: AIS's current net profit margins (7.1%) are lower than last year (10.8%).

Past Earnings Growth Analysis

Earnings Trend: AIS has become profitable over the past 5 years, growing earnings by 30.1% per year.

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

Earnings vs Industry: AIS had negative earnings growth (-18.6%) over the past year, making it difficult to compare to the Metals and Mining industry average (57.3%).

Return on Equity

High ROE: AIS's Return on Equity (14.8%) is considered low.

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Financial Health

How is Aeris 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: AIS's short term assets (A$124.0M) exceed its short term liabilities (A$94.9M).

Long Term Liabilities: AIS's short term assets (A$124.0M) exceed its long term liabilities (A$58.4M).

Debt to Equity History and Analysis

Debt Level: AIS has more cash than its total debt.

Reducing Debt: AIS's debt to equity ratio has reduced from 925.8% to 0.2% over the past 5 years.

Debt Coverage: AIS's debt is well covered by operating cash flow (35973.5%).

Interest Coverage: AIS's interest payments on its debt are well covered by EBIT (6.4x coverage).

Balance Sheet

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Dividend

What is Aeris Resources's 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 AIS's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate AIS'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 AIS's dividends per share have been stable in the past.

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

Earnings Payout to Shareholders

Earnings Coverage: AIS is not paying a notable dividend for the Australian market.

Cash Payout to Shareholders

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

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Management

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

9.1yrs

Average management tenure

CEO

Willie Labuschagne (55 yo)

9.67yrs

Tenure

AU$1,522,553

Compensation

Mr. Willie Andre Labuschagne, B.Comm, has been an Independent Director of Magontec Limited since May 04, 2022. He had been a Non-Executive Director of Magontec Limited since January 22, 2014 until May 04,...

CEO Compensation Analysis

Compensation vs Market: Willie's total compensation ($USD1.06M) is above average for companies of similar size in the Australian market ($USD567.29K).

Compensation vs Earnings: Willie's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.

Leadership Team

Experienced Management: AIS's management team is seasoned and experienced (9.1 years average tenure).

Board Members

Experienced Board: AIS's board of directors are considered experienced (5.7 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 substantially diluted in the past year, with total shares outstanding growing by 116.9%.

Data	Last Updated (UTC time)
Company Analysis	2022/08/05 00:00
End of Day Share Price	2022/08/05 00:00
Earnings	2021/12/31
Annual Earnings	2021/06/30