JSE:MRF

Stock Analysis Report

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Executive Summary

Merafe Resources Limited engages in the mining and beneficiation of chrome ore into ferrochrome. More Details


Snowflake Analysis

Excellent balance sheet with moderate growth potential.


Similar Companies

Share Price & News

How has Merafe Resources's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: MRF is more volatile than 75% of ZA stocks over the past 3 months, typically moving +/- 10% a week.

Volatility Over Time: MRF's weekly volatility (10%) has been stable over the past year, but is still higher than 75% of ZA stocks.


Market Performance


7 Day Return

22.7%

MRF

-1.3%

ZA Metals and Mining

2.0%

ZA Market


1 Year Return

-22.9%

MRF

38.9%

ZA Metals and Mining

1.2%

ZA Market

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

Return vs Market: MRF underperformed the ZA Market which returned 1.2% over the past year.


Shareholder returns

MRFIndustryMarket
7 Day22.7%-1.3%2.0%
30 Day28.6%8.0%7.2%
90 Day8.0%6.3%12.9%
1 Year-11.0%-22.9%44.2%38.9%6.5%1.2%
3 Year-51.5%-64.0%242.6%206.5%2.9%-17.9%
5 Year14.4%-20.6%376.2%301.0%51.0%8.9%

Long-Term Price Volatility Vs. Market

How volatile is Merafe Resources's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Merafe Resources undervalued compared to its fair value and its price relative to the market?

0.58x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: MRF (ZAR0.54) is trading above our estimate of fair value (ZAR0.22)

Significantly Below Fair Value: MRF is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: MRF is unprofitable, so we can't compare its PE Ratio to the ZA Metals and Mining industry average.

PE vs Market: MRF is unprofitable, so we can't compare its PE Ratio to the ZA market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate MRF's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: MRF is good value based on its PB Ratio (0.6x) compared to the ZA Metals and Mining industry average (1.2x).


Next Steps

Future Growth

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

65.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: MRF is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (9.3%).

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

High Growth Earnings: MRF's is expected to become profitable in the next 3 years.

Revenue vs Market: MRF's revenue (9.5% per year) is forecast to grow slower than the ZA market (10.7% per year).

High Growth Revenue: MRF's revenue (9.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: MRF's Return on Equity is forecast to be low in 3 years time (9.1%).


Next Steps

Past Performance

How has Merafe Resources performed over the past 5 years?

-42.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: MRF is currently unprofitable.

Growing Profit Margin: MRF is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: MRF is unprofitable, and losses have increased over the past 5 years at a rate of 42.1% per year.

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

Earnings vs Industry: MRF is unprofitable, making it difficult to compare its past year earnings growth to the Metals and Mining industry (136.9%).


Return on Equity

High ROE: MRF has a negative Return on Equity (-107.3%), as it is currently unprofitable.


Next Steps

Financial Health

How is Merafe Resources's financial position?


Financial Position Analysis

Short Term Liabilities: MRF's short term assets (ZAR2.9B) exceed its short term liabilities (ZAR544.8M).

Long Term Liabilities: MRF's short term assets (ZAR2.9B) exceed its long term liabilities (ZAR361.9M).


Debt to Equity History and Analysis

Debt Level: MRF's debt to equity ratio (0.07%) is considered satisfactory.

Reducing Debt: MRF's debt to equity ratio has reduced from 24.1% to 0.07% over the past 5 years.

Debt Coverage: MRF's debt is well covered by operating cash flow (43277.2%).

Interest Coverage: Insufficient data to determine if MRF's interest payments on its debt are well covered by EBIT.


Balance Sheet


Next Steps

Dividend

What is Merafe Resources's current dividend yield, its reliability and sustainability?

7.41%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: MRF's dividend (7.41%) is higher than the bottom 25% of dividend payers in the ZA market (2.98%).

High Dividend: MRF's dividend (7.41%) is low compared to the top 25% of dividend payers in the ZA market (8.8%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: MRF is paying a dividend but the company is unprofitable.


Future Payout to Shareholders

Future Dividend Coverage: MRF's dividends in 3 years are forecast to be well covered by earnings (16.1% payout ratio).


Next Steps

Management

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

6.3yrs

Average management tenure


CEO

Zanele Matlala (57 yo)

8.58yrs

Tenure

R9,020,000

Compensation

Ms. Zanele Joyce Matlala, BCom, BCompt (Hons), CA (SA), has been Independent Non-Executive Director of Royal Bafokeng Platinum Limited since September 25, 2018. She has been the Chief Executive Officer at ...


CEO Compensation Analysis

Compensation vs Market: Zanele's total compensation ($USD605.86K) is above average for companies of similar size in the ZA market ($USD311.59K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Zanele Matlala
CEO & Executive Director8.58yrsR9.02m0.20%
ZAR 2.3m
Ditabe Chocho
Financial Director & Executive Director2.42yrsR3.24m0.024%
ZAR 286.0k
William Somerville
Company Secretary6.25yrsno datano data

6.3yrs

Average Tenure

57yo

Average Age

Experienced Management: MRF's management team is seasoned and experienced (6.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Zanele Matlala
CEO & Executive Director8.58yrsR9.02m0.20%
ZAR 2.3m
Ditabe Chocho
Financial Director & Executive Director2.42yrsR3.24m0.024%
ZAR 286.0k
Abiel Mngomezulu
Independent Non Executive Chairperson1.67yrsR681.00kno data
Mpho M. Mosweu
Non-Independent Non Executive Director9.83yrsR357.00kno data
Matsotso Vuso
Independent Non-Executive Director2.5yrsR516.00kno data
Belese Majova
Independent Non-Executive Director12yrsR541.00k0.0025%
ZAR 29.4k
Shaun Blankfield
Independent Director5.67yrsR364.00kno data
Jeffery Mclaughlan
Independent Non-Executive Director1.67yrsR274.00kno data
Katlego Tlale
Independent Non-Executive Director0.083yrno datano data

2.5yrs

Average Tenure

48yo

Average Age

Experienced Board: MRF's board of directors are not considered experienced ( 2.5 years average tenure), which suggests a new board.


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 not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Merafe Resources Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Merafe Resources Limited
  • Ticker: MRF
  • Exchange: JSE
  • Founded: 1987
  • Industry: Steel
  • Sector: Materials
  • Market Cap: R1.180b
  • Shares outstanding: 2.51b
  • Website: https://www.meraferesources.co.za

Number of Employees


Location

  • Merafe Resources Limited
  • Building B
  • Second Floor
  • Bryanston
  • Gauteng
  • 2191
  • South Africa

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
MRFJSE (The Johannesburg Securities Exchange)YesOrdinary SharesZAZARMar 1994
RZTDB (Deutsche Boerse AG)YesOrdinary SharesDEEURMar 1994

Biography

Merafe Resources Limited engages in the mining and beneficiation of chrome ore into ferrochrome. It primarily serves stainless steel mills in Africa, the Middle East, the United States, other Asia countrie...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/01/21 17:02
End of Day Share Price2021/01/21 00:00
Earnings2020/06/30
Annual Earnings2019/12/31


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.