JSE:ARI

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African Rainbow Minerals

Executive Summary

African Rainbow Minerals Limited operates as a diversified mining and minerals company in South Africa, Malaysia, Europe, the Americas, and the Far and Middle East. More Details


Snowflake Analysis

Flawless balance sheet average dividend payer.


Similar Companies

Share Price & News

How has African Rainbow Minerals's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ARI is not significantly more volatile than the rest of ZA stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: ARI's weekly volatility (6%) has been stable over the past year.


Market Performance


7 Day Return

-0.3%

ARI

-1.3%

ZA Metals and Mining

2.0%

ZA Market


1 Year Return

74.2%

ARI

38.9%

ZA Metals and Mining

1.2%

ZA Market

Return vs Industry: ARI exceeded the ZA Metals and Mining industry which returned 38.9% over the past year.

Return vs Market: ARI exceeded the ZA Market which returned 1.2% over the past year.


Shareholder returns

ARIIndustryMarket
7 Day-0.3%-1.3%2.0%
30 Day17.6%8.0%7.2%
90 Day26.4%6.3%12.9%
1 Year90.7%74.2%44.2%38.9%6.5%1.2%
3 Year209.0%139.1%242.6%206.5%2.9%-17.9%
5 Year722.3%479.6%376.2%301.0%51.0%8.9%

Long-Term Price Volatility Vs. Market

How volatile is African Rainbow Minerals's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is African Rainbow Minerals undervalued compared to its fair value and its price relative to the market?

1.8%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ARI (ZAR303.37) is trading below our estimate of fair value (ZAR308.98)

Significantly Below Fair Value: ARI is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: ARI is good value based on its PE Ratio (14.9x) compared to the ZA Metals and Mining industry average (15.5x).

PE vs Market: ARI is poor value based on its PE Ratio (14.9x) compared to the ZA market (13.6x).


Price to Earnings Growth Ratio

PEG Ratio: ARI is poor value based on its PEG Ratio (1.7x)


Price to Book Ratio

PB vs Industry: ARI is overvalued based on its PB Ratio (1.8x) compared to the ZA Metals and Mining industry average (1.2x).


Next Steps

Future Growth

How is African Rainbow Minerals forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

8.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ARI's forecast earnings growth (8.6% per year) is below the savings rate (9.3%).

Earnings vs Market: ARI's earnings (8.6% per year) are forecast to grow slower than the ZA market (29.7% per year).

High Growth Earnings: ARI's earnings are forecast to grow, but not significantly.

Revenue vs Market: ARI's revenue (8.4% per year) is forecast to grow slower than the ZA market (10.7% per year).

High Growth Revenue: ARI's revenue (8.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ARI's Return on Equity is forecast to be low in 3 years time (16.1%).


Next Steps

Past Performance

How has African Rainbow Minerals performed over the past 5 years?

40.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ARI has high quality earnings.

Growing Profit Margin: ARI's current net profit margins (34%) are lower than last year (40.2%).


Past Earnings Growth Analysis

Earnings Trend: ARI's earnings have grown significantly by 40.2% per year over the past 5 years.

Accelerating Growth: ARI's earnings growth over the past year (11.4%) is below its 5-year average (40.2% per year).

Earnings vs Industry: ARI earnings growth over the past year (11.4%) underperformed the Metals and Mining industry 136.9%.


Return on Equity

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


Next Steps

Financial Health

How is African Rainbow Minerals's financial position?


Financial Position Analysis

Short Term Liabilities: ARI's short term assets (ZAR10.7B) exceed its short term liabilities (ZAR2.9B).

Long Term Liabilities: ARI's short term assets (ZAR10.7B) exceed its long term liabilities (ZAR5.6B).


Debt to Equity History and Analysis

Debt Level: ARI's debt to equity ratio (4.5%) is considered satisfactory.

Reducing Debt: ARI's debt to equity ratio has reduced from 14.1% to 4.5% over the past 5 years.

Debt Coverage: ARI's debt is well covered by operating cash flow (422.6%).

Interest Coverage: ARI earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

What is African Rainbow Minerals's current dividend yield, its reliability and sustainability?

3.96%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: ARI's dividend (3.96%) is higher than the bottom 25% of dividend payers in the ZA market (2.98%).

High Dividend: ARI's dividend (3.96%) is low compared to the top 25% of dividend payers in the ZA market (8.8%).


Stability and Growth of Payments

Stable Dividend: ARI's dividend payments have been volatile in the past 10 years.

Growing Dividend: ARI's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (58.8%), ARI's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ARI's dividends in 3 years are forecast to be covered by earnings (56.2% payout ratio).


Next Steps

Management

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

3.8yrs

Average management tenure


CEO

Mike Schmidt (62 yo)

8.83yrs

Tenure

R48,194,000

Compensation

Mr. Mike P. Schmidt, also known as Mike, has served as Chief Executive Officer of African Rainbow Minerals Limited (“ARM”) since March 2012. Mr. Schmidt joined ARM as Executive, Platinum Operations in July...


CEO Compensation Analysis

Compensation vs Market: Mike's total compensation ($USD3.24M) is above average for companies of similar size in the ZA market ($USD1.32M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Patrice Motsepe
Executive Chairman17yrsR73.17m0.12%
ZAR 70.7m
Michael Schmidt
CEO & Director8.83yrsR48.19m0.25%
ZAR 143.0m
Jongisa Magagula
Executive Director of IR & New Business Development and Executive Director1.08yrsR4.90m0.0066%
ZAR 3.8m
H. Mkatshana
Executive Director5.92yrsR19.54m0.084%
ZAR 49.2m
André Joubert
Chief Executive of ARM Ferrous8.5yrsR23.34m0.042%
ZAR 24.5m
Derrick King
Acting Finance Director and Senior Executive Finance-Corporate & Tax0.33yrno datano data
Tsundzukani T. Mhlanga
CFO & Finance Director0.25yrno datano data
Princess Thwala
Group Executive of Compliance & Stakeholder Relationsno datano datano data
Lucas Moalusi
Group Executive of Legal1yrno datano data
Busisiwe Mashiane
Group Executive of Human Resources6.5yrsno datano data
Mitesh Takoordeen
Chief Information Officerno datano datano data
Reshma Ramkumar
Chief Risk Officer1yrno datano data

3.8yrs

Average Tenure

54.5yo

Average Age

Experienced Management: ARI's management team is considered experienced (3.8 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Patrice Motsepe
Executive Chairman17yrsR73.17m0.12%
ZAR 70.7m
Michael Schmidt
CEO & Director8.83yrsR48.19m0.25%
ZAR 143.0m
Jongisa Magagula
Executive Director of IR & New Business Development and Executive Director1.08yrsR4.90m0.0066%
ZAR 3.8m
H. Mkatshana
Executive Director5.92yrsR19.54m0.084%
ZAR 49.2m
Tsundzukani T. Mhlanga
CFO & Finance Director0.25yrno datano data
Anton Botha
Independent Non-Executive Director12yrsR1.34m0%
ZAR 0
Thomas Boardman
Independent Non-Executive Director10yrsR1.70mno data
Michael Arnold
Non-Executive Director12yrsR1.27m0.10%
ZAR 58.7m
Jan Steenkamp
Independent Non-Executive Director3.25yrsR1.03m0.14%
ZAR 82.0m
Wilson Gule
Independent Non-Executive Director17yrsR581.00kno data
Alexander Maditse
Lead Independent Non-Executive Director5.83yrsR2.19mno data
David Noko
Independent Non-Executive Director3.25yrsR771.00kno data

7.6yrs

Average Tenure

62yo

Average Age

Experienced Board: ARI's board of directors are considered experienced (7.6 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: ARI insiders have only sold shares 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

African Rainbow Minerals Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: African Rainbow Minerals Limited
  • Ticker: ARI
  • Exchange: JSE
  • Founded: 1933
  • Industry: Diversified Metals and Mining
  • Sector: Materials
  • Market Cap: R58.222b
  • Shares outstanding: 195.80m
  • Website: https://www.arm.co.za

Number of Employees


Location

  • African Rainbow Minerals Limited
  • ARM House
  • 29 Impala Road
  • Sandton
  • Gauteng
  • 2196
  • South Africa

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ARIJSE (The Johannesburg Securities Exchange)YesOrdinary SharesZAZARJan 1992
EB9DB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992
AFBO.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992

Biography

African Rainbow Minerals Limited operates as a diversified mining and minerals company in South Africa, Malaysia, Europe, the Americas, and the Far and Middle East. The company explores for precious metals...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/01/21 17:01
End of Day Share Price2021/01/21 00:00
Earnings2020/06/30
Annual Earnings2020/06/30


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.