Ann: Record quarterly gold production for Ramelius, page-75

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deserthead

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12/04/24

15:04

Post #: 73317435
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Originally posted by jdpc35: ↑

I note a few comments on here about RMS current share price (the "too high - I'm out" camp vs the "too cheap" camp). As a starter, I am in the latter camp and thought it worth putting some maths around the topic of valuation.

As of the most recent announcement, RMS has $407m of cash and gold and delivered $125m generated cash for the quarter. I will ignore the generated cash for the moment and focus more on forecast annualisd EBITDA.

1. Current market cap is circa $2,200m - so deduct cash and enterprise is being valued at circa $1,800m.

2. Forecast FY24 EBITDA is around the $390m mark following the Q3 results. Current share price (net of cash) about 4.6x EBITDA. As of 30th June with a further $120m cash in bank, it is around 4.3x multiple.

3. Forecast FY25 is around the $580m mark. If we apply a 4.5x multiple, then implies a valuation of $2,610m + $520m cash = EV $3,130m or about $2.75 per share.

4. Peers are trading at around the 6x EBITDA multiple = valuation of $3,480m + cash = $4,000m or about $3.50/share (which is incidentally also my target based on technical analysis).

Note that the above FY25 forecast (source Ord Minnett) was when the gold price was circa US$2.100 vs the US$2,400 currently. Allowing for hedging, if current prices are maintained, there is a further $80m of EBITDA potential or (at 4.5x multiple) a further 30c+ per share upside.

For the above reasons, I think there is much more to play out in terms of RMS share price in the coming months.

At the moment Mr Market is just oscillating around the $2.00 mark which is normal as a stock approaches a "big" figure - often an initial break of the figure, a pullback below the figure, then a surge through the figure and then another pullback to test the figure before moving forward. We have had the first 2 components and I believe we are just now setting up to surge through the $2.00 barrier.

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Mr Market is totally clueless,after being beaten savagely about the head by gold stocks for the last 3years,and now only willing to hold them for the most part,short term, in fear of being beaten yet again.
This is the fuel,for continuing higher prices.

Last edited by deserthead: 12/04/24

RMS Price at posting: $1.98 Sentiment: Buy Disclosure: Held
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(20min delay)
Last $1.96		Change 0.015(0.77%)		Mkt cap ! $2.236B

Open	High	Low	Value	Volume
$1.93	$1.98	$1.93	$5.447M	2.783M

Buyers (Bids)

No.	Vol.	Price($)
9	83232	$1.95

Sellers (Offers)

Price($)	Vol.	No.
$1.96	9655	6

View Market Depth

No.	Vol.	Price($)
7	61157	1.950
3	26008	1.945
3	38335	1.940
1	8054	1.935
2	20054	1.930

Price($)	Vol.	No.
1.960	9655	6
1.965	22458	7
1.970	18054	2
1.975	44367	6
1.980	102828	5

Last trade - 16.10pm 22/07/2024 (20 minute delay)

RMS (ASX) Chart

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Ann: Record quarterly gold production for Ramelius, page-75

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