Australia's largest stock trading and investment forum Australia's #1 stock forum

ARL

Click for more information

0.00%

46.0¢ ardea resources limited

Valuations for ARL - FA only., page-4

First 4 Last

Share
Profile

Follow
ebner

331 Posts.

64

24/07/18

06:48

Post #: 34528474
Share

Originally posted by ukpdam ↑

Squash, I commend you for the valuation analysis. This is also the way I like to approach determining what share price is appropriate based on underlying fundamentals. The thing that I struggle with, however, is what earnings value to employ when extending by an appropriate P/E ratio to arrive at a stock price.

In your anaysis I see you using EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization). In the case of an early mine development project we can at least assume that the interest on the capex borrowing will likely be substantial. Interest at 8% on a US$ 1.5B loan for example comes in at US$ 120M per year in the first year, and that is not including the repayment of principal. The potential value to shareholders seems to me to be more aligned with the earnings after all costs, or better yet the free cash flows after all costs. What is your opinion on this?

Expand

You are right to use 1.5B capex. Anyone who thinks they get a 2.25mtpa throughput mine for 700M is bound for disappointment. And the rest of your post is also right thinking. Calculating a stock price without the context of expenses is inaccurate, at the end of the day, its all about profit.

ARL Price at posting: 86.0¢ Sentiment: Hold Disclosure: Held
6 Upvote

0 Great analysis

Reply

Top Stories

AZL

Brine and shine: Arizona Lithium wins early stage eco approval to commence wellpad #2 at Prairie

BIO

Biome unveils three year revenue target up to $85M – but are 3Y targets enough to excite?

BOE

$550 million Jabiluka uranium offer comes unstuck as Government rules lease won't be renewed

PAM

PAM secures high-grade Chilean copper play in strong territory

IVZ

Invictus banks US$5M from Zimbabwean investment fund in support of Cabora Bassa

There are more pages in this discussion • 39 more messages in this thread...

First 4 Last

Add ARL (ASX) to my watchlist

(20min delay)
Last 46.0¢		Change 0.000(0.00%)		Mkt cap ! $91.85M

Open	High	Low	Value	Volume
46.0¢	46.0¢	46.0¢	$467	1.015K

Buyers (Bids)

No.	Vol.	Price($)
1	9327	45.5¢

Sellers (Offers)

Price($)	Vol.	No.
46.5¢	3296	2

View Market Depth

No.	Vol.	Price($)
1	9327	0.455
3	10304	0.450
1	42000	0.440
1	20000	0.435
3	12200	0.420

Price($)	Vol.	No.
0.465	3296	2
0.470	7334	4
0.485	10000	1
0.490	4680	1
0.500	11258	1

Last trade - 13.38pm 29/07/2024 (20 minute delay)

ARL (ASX) Chart