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LR8

Largo DB:LR8 Stock Report

Last Price

€6.50

Market Cap

€402.9m

7D

4.8%

1Y

-41.4%

Updated

15 Sep, 2022

Data

Company Financials +
LR8 fundamental analysis
Snowflake Score
Valuation3/6
Future Growth5/6
Past Performance3/6
Financial Health6/6
Dividends0/6

LR8 Stock Overview

Largo Inc. engages in the development and sale of vanadium-based utility scale electrical energy storage systems in Canada.

Largo Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Largo
Historical stock prices
Current Share PriceCA$6.50
52 Week HighCA$12.79
52 Week LowCA$6.20
Beta1.71
1 Month Change-12.75%
3 Month Change-5.80%
1 Year Change-41.44%
3 Year Change-40.67%
5 Year Change-5.80%
Change since IPO-84.15%

Recent News & Updates

Shareholder Returns

LR8DE Metals and MiningDE Market
7D4.8%-2.8%0.3%
1Y-41.4%-29.3%-24.2%

Return vs Industry: LR8 underperformed the German Metals and Mining industry which returned -29.3% over the past year.

Return vs Market: LR8 underperformed the German Market which returned -24.2% over the past year.

Price Volatility

Is LR8's price volatile compared to industry and market?
LR8 volatility
LR8 Average Weekly Movement8.1%
Metals and Mining Industry Average Movement8.9%
Market Average Movement5.7%
10% most volatile stocks in DE Market9.9%
10% least volatile stocks in DE Market2.8%

Stable Share Price: LR8 is more volatile than 75% of German stocks over the past 3 months, typically moving +/- 8% a week.

Volatility Over Time: LR8's weekly volatility (8%) has been stable over the past year, but is still higher than 75% of German stocks.

About the Company

FoundedEmployeesCEOWebsite
1988478Paulo Miskhttps://www.largoinc.com

Largo Inc. engages in the development and sale of vanadium-based utility scale electrical energy storage systems in Canada. The company operates in five segments: Sales & Trading, Mine Properties, Corporate, Exploration and Evaluation Properties, and Largo Clean Energy. Its products include VPURE+ vanadium flakes that are used in the production of master alloys and aerospace applications; VPURE vanadium flakes ferrovanadium and vanadium carbon nitride for the steel industry; and VPURE+ vanadium powder for catalyst applications.

Largo Fundamentals Summary

How do Largo's earnings and revenue compare to its market cap?
LR8 fundamental statistics
Market Cap€402.89m
Earnings (TTM)€26.29m
Revenue (TTM)€231.79m

15.3x

P/E Ratio

1.7x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
LR8 income statement (TTM)
RevenueUS$231.68m
Cost of RevenueUS$149.53m
Gross ProfitUS$82.15m
Other ExpensesUS$55.87m
EarningsUS$26.27m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)0.41
Gross Margin35.46%
Net Profit Margin11.34%
Debt/Equity Ratio5.2%

How did LR8 perform over the long term?

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

Valuation

Is LR8 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 LR8?

Other financial metrics that can be useful for relative valuation.

LR8 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/Revenue1.6x
Enterprise Value/EBITDA6.3x
PEG Ratio0.2x

Price to Earnings Ratio vs Peers

How does LR8's PE Ratio compare to its peers?

LR8 PE Ratio vs Peers
The above table shows the PE ratio for LR8 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average7.8x
OLG Verallia Deutschland
14.8xn/a€630.0m
SIM0 SIMONA
13.9xn/a€546.0m
SZG Salzgitter
1.1x-56.7%€1.3b
PNX Pasinex Resources
1.1xn/a€2.9m
LR8 Largo
15.3x64.3%€531.6m

Price-To-Earnings vs Peers: LR8 is expensive based on its Price-To-Earnings Ratio (15.3x) compared to the peer average (7.8x).


Price to Earnings Ratio vs Industry

How does LR8's PE Ratio compare vs other companies in the European Metals and Mining Industry?

Price-To-Earnings vs Industry: LR8 is expensive based on its Price-To-Earnings Ratio (15.3x) compared to the European Metals and Mining industry average (4.9x)


Price to Earnings Ratio vs Fair Ratio

What is LR8'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.

LR8 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio15.3x
Fair PE Ratio47.9x

Price-To-Earnings vs Fair Ratio: LR8 is good value based on its Price-To-Earnings Ratio (15.3x) compared to the estimated Fair Price-To-Earnings Ratio (47.9x).


Share Price vs Fair Value

What is the Fair Price of LR8 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: LR8 (€6.5) is trading below our estimate of fair value (€44.72)

Significantly Below Fair Value: LR8 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 analysts are not within a statistically confident range of agreement.


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Future Growth

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

Future Growth Score

5/6

Future Growth Score 5/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


64.3%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LR8's forecast earnings growth (64.3% per year) is above the savings rate (-0.01%).

Earnings vs Market: LR8's earnings (64.3% per year) are forecast to grow faster than the German market (9.8% per year).

High Growth Earnings: LR8's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: LR8's revenue (5.6% per year) is forecast to grow faster than the German market (3.8% per year).

High Growth Revenue: LR8's revenue (5.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LR8's Return on Equity is forecast to be high in 3 years time (20%)


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Past Performance

How has Largo performed over the past 5 years?

Past Performance Score

3/6

Past Performance Score 3/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


-17.9%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: LR8 has high quality earnings.

Growing Profit Margin: LR8's current net profit margins (11.3%) are lower than last year (13.4%).


Past Earnings Growth Analysis

Earnings Trend: LR8 has become profitable over the past 5 years, growing earnings by -17.9% per year.

Accelerating Growth: LR8's earnings growth over the past year (19.3%) exceeds its 5-year average (-17.9% per year).

Earnings vs Industry: LR8 earnings growth over the past year (19.3%) underperformed the Metals and Mining industry 67.3%.


Return on Equity

High ROE: LR8's Return on Equity (9%) is considered low.


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Financial Health

How is Largo'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: LR8's short term assets ($190.6M) exceed its short term liabilities ($61.6M).

Long Term Liabilities: LR8's short term assets ($190.6M) exceed its long term liabilities ($6.7M).


Debt to Equity History and Analysis

Debt Level: LR8 has more cash than its total debt.

Reducing Debt: LR8's debt to equity ratio has reduced from 1086.3% to 5.2% over the past 5 years.

Debt Coverage: LR8's debt is well covered by operating cash flow (118.6%).

Interest Coverage: LR8's interest payments on its debt are well covered by EBIT (93x coverage).


Balance Sheet


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Dividend

What is Largo 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 LR8's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate LR8'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 LR8's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if LR8'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 LR8 has not reported any payouts.


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Management

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

6.4yrs

Average management tenure


CEO

Paulo Misk (59 yo)

3.92yrs

Tenure

US$1,976,980

Compensation

Mr. Paulo Guimarães Misk serves as Chief Executive Officer of Largo Inc. (formerly known as Largo Resources Ltd.) since September 8, 2019 and has been its Director since September 9, 2019. Mr. Misk is the...


CEO Compensation Analysis

Compensation vs Market: Paulo's total compensation ($USD1.98M) is above average for companies of similar size in the German market ($USD1.15M).

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


Leadership Team

Experienced Management: LR8's management team is seasoned and experienced (6.4 years average tenure).


Board Members

Experienced Board: LR8's board of directors are considered experienced (7.2 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

DB:LR8 Recent Insider Transactions by Companies or Individuals
DateValueNameEntityRoleSharesMax Price
20 May 22Buy€140,928Paulo MiskIndividual15,170€9.29
25 Mar 22Sell€116,510Nilson ChavesIndividual10,000€11.65
10 Feb 22Buy€34,384Koko YamamotoIndividual3,825€8.99
15 Dec 21Buy€10,751Ernest CleaveIndividual1,500€7.18
17 Nov 21Buy€19,374Paul DalglishIndividual2,000€9.69
14 Oct 21Buy€355,113Ian RobertsonIndividual36,000€9.86

Ownership Breakdown

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


Top Shareholders

Top 25 shareholders own 66.76% of the company
OwnershipNameSharesCurrent ValueChange %Portfolio %
43.72%
Arias Resource Capital Management LP
28,039,020$182.3m0%88.68%
8.69%
West Family Investments, Inc.
5,572,637$36.2m0%13.36%
7.47%
Grantham Mayo Van Otterloo & Co. LLC
4,790,949$31.1m10.54%0.1%
1.9%
BNY Mellon Asset Management
1,218,405$7.9m59.93%no data
0.66%
Alyeska Investment Group, L.P.
424,900$2.8m5.75%0.03%
0.64%
Dolefin SA
410,000$2.7m0%2.39%
0.55%
Konwave AG
350,035$2.3m0%0.27%
0.42%
Rezco Investment Counsel (PTY) Ltd.
271,739$1.8m0%64%
0.38%
BlackRock, Inc.
240,858$1.6m-1.2%no data
0.25%
Baker Steel Capital Managers LLP
162,500$1.1m0%0.12%
0.22%
ETFS Management (AUS) Limited
143,437$932.3k0%0.08%
0.22%
Toroso Investments, LLC
143,115$930.2k20.04%0.03%
0.19%
Russell Investment Management, LLC
122,538$796.5k21.55%no data
0.19%
Paulo Misk
122,510$796.3k14.13%no data
0.18%
Mid-Continent Capital LLC
115,726$752.2k0%0.04%
0.15%
Claybrook Capital, Llc
99,295$645.4k0%0.38%
0.14%
Swiss National Bank, Asset Management Arm
92,110$598.7k8.74%no data
0.12%
American Beacon Advisors, Inc.
78,175$508.1k-2.39%0.01%
0.11%
Morgan Stanley, Investment Banking and Brokerage Investments
69,426$451.3k-61.4%no data
0.1%
JPMorgan Chase & Co, Brokerage and Securities Investments
66,423$431.7k-49.67%no data
0.098%
Jesus Alberto Arias
62,533$406.5k0%no data
0.089%
Schroder Investment Management North America Inc.
57,253$372.1k0%no data
0.087%
Barclays PLC Private Banking & Investment Banking Investment
56,080$364.5k0%no data
0.084%
Ernest Cleave
53,634$348.6k0%no data
0.082%
IronHorse Capital LLC
52,475$341.1k0%1.22%

Company Information

Largo Inc.'s employee growth, exchange listings and data sources


Key Information

  • Name: Largo Inc.
  • Ticker: LR8
  • Exchange: DB
  • Founded: 1988
  • Industry: Diversified Metals and Mining
  • Sector: Materials
  • Implied Market Cap: CA$531.638m
  • Listing Market Cap: CA$402.890m
  • Shares outstanding: 64.13m
  • Website: https://www.largoinc.com

Number of Employees


Location

  • Largo Inc.
  • 55 University Avenue
  • Suite 1105
  • Toronto
  • Ontario
  • M5J 2H7
  • Canada


Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
LGOTSX (The Toronto Stock Exchange)YesCommon SharesCACADMar 1990
LR8DB (Deutsche Boerse AG)YesCommon SharesDEEURMar 1990
LGONasdaqGS (Nasdaq Global Select)YesCommon SharesUSUSDMar 1990

Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/09/15 00:00
End of Day Share Price2022/09/15 00:00
Earnings2022/06/30
Annual Earnings2021/12/31


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.