Discounted Cash Flow Calculation for OTCPK:SMCD.Y using 2 Stage Free Cash Flow to Equity Model
The calculations below outline how an intrinsic value for
is arrived at by discounting future cash flows to their present value using the 2 stage method. We use
analyst's estimates of cash flows going forward 5 years for the 1st stage, the 2nd stage assumes the company grows at a stable rate into perpetuity.
OTCPK:SMCD.Y DCF 1st Stage: Next 5 year cash flow forecast
The current share price of
is above its future cash flow value.
Often investors are willing to pay a
for a company that has a high dividend or the potential for future growth.
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for
it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing
when they are out of season, or how much your home is worth.
The amount the stock market is willing to pay for
is considered below, and whether this is a fair price.
Price based on past earnings
Strategic Minerals's earnings available for a low price, and how does
this compare to other companies in the same industry?
Strategic Minerals's earnings are expected to decrease over the next 1-3 years, this is not considered high growth.
Unable to determine if Strategic Minerals is high growth as no revenue estimate data is available.
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can
be gauged below. We look back 3 years and see if they were any good at
predicting what actually occurred. We also show the highest and lowest estimates
looking forward to see if there is a wide range.
Strategic Minerals's performance over the past 5 years by checking for:
Has earnings increased in past 5 years? (1 check)
Has the earnings growth in the last year exceeded that of the
Metals and Mining
industry? (1 check)
Is the recent earnings growth over the last year higher than the average annual growth over the
past 5 years? (1 check)
Is the Return on Equity (ROE) higher than 20%? (1 check)
Is the Return on Assets (ROA) above industry average? (1 check)
Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent
earnings report. Some checks require at least 3 or 5 years worth of data.
has a total score of
5/6, see the detailed checks below.
Note: We use GAAP Net Income excluding extraordinary items in all our calculations.
A company's financial position is much like your own financial position,
it includes everything you own
The boxes below represent the relative size of what makes up
Strategic Minerals's finances.
The net worth of a company is the difference between its assets and liabilities.
Strategic Minerals is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
Strategic Minerals has no long term commitments.
This treemap shows a more detailed breakdown of
Strategic Minerals's finances. If any of them are yellow this
indicates they may be out of proportion and red means they relate to one of the
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
Low level of unsold assets.
Strategic Minerals has no debt, it does not need to be covered by short term assets.
Nearly all companies have debt. Debt in itself isn’t
however if the debt is too high, or the company can’t afford to pay the interest
on its debts this may have impacts in the future.
The graphic below shows equity (available funds) and debt, we ideally want to
see the red area (debt) decreasing.
If there is any debt we look at the companies capability to repay it, and
whether the level has increased over the past 5 years.
Management is one of the most important areas of a company. We look at
unreasonable CEO compensation, how long the team and board of directors have
been around for and insider trading.
TENURE AS CEO
Mr. John Peters, FCPA, FFINSIA, has been Chief Executive Officer of Strategic Minerals plc since October 9, 2015 and its Managing Director since January 2015. Mr. Peters served as the Chief Executive Officer and Chief Financial Officer of Ebony Iron Pty Ltd. Mr. Peters managed the contractual and operational aspects of multi billion dollar investment organizations and large scale transactions from origination to completion. He advised on private equity in the oil, gas and mining sectors in partnership with James Chisholm having finalized transactions for sale and equity raisings of a number of companies in mining and oil. Mr. Peters serves as Chief Executive Officer with over 30 years' corporate finance experience at senior levels. His expertise crosses a number of industries including natural resources and he is experienced in publically listed companies on the AIM and ASX stock exchanges. From his experience managing over £7bn of investment funds for the Commonwealth Bank of Australia, he understands capital raising, mergers and acquisitions and how they are perceived by professional investors. He is experienced in acquisition strategies, mining project evaluation, commercial agreements, statutory and management reporting and compliance and governance obligations of public companies. Mr. Peters served as an Executive Chairman of Strategic Minerals plc from January 21, 2015 to June 30, 2015. He has been an Executive Director at Strategic Minerals plc since January 21, 2015.
John's compensation has been consistent with company performance over the past year.
John's remuneration is lower than average for companies of similar size in United States of America.
Management Team Tenure
Average tenure and age of the
management team in years:
The tenure for the Strategic Minerals management team is about average.
MD & Executive Director
Chief Financial Officer
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The average tenure for the Strategic Minerals board of directors is less than 3 years, this suggests a new board.
Strategic Minerals plc operates as a diversified mineral production and development company. The company operates Cobre mine in New Mexico, the United States, which sells magnetite for use in the cement, fertilizer, dense media/medium, paint pigment, water jet cutting, ballast, magnet, toner, coal cleaning, and landscaping markets. It also holds 100% interest in various tenements in the Northern Territory and Western Australia that are prospective for cobalt, gold, nickel sulphides, and rare earth elements; and the Leigh Creek copper mine that is situated in the copper rich belt of South Australia, as well as the Redmoor tin/tungsten exploration project in the United Kingdom. The company was founded in 2010 and is based in London, the United Kingdom.
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