Ann: Preliminary FY2021 Production, Cost and Sales Results, page-7

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Thursday, 15 July 2021

SFR - SANDFIRE RESOURCES LIMITED

Credit Suisse rates SFR as Outperform (1) - Sandfire Resources finished the year strongly with copper and gold production at DeGrussa at, or above, the top end of guidance. DeGrussa will enter its final 15 months of planned copper production and the focus is shifting to Botswana.

Credit Suisse notes the coronavirus outbreak in Botswana is at its most severe and appears to be worsening and vaccine supply is yet to be secured. Hence, the current timeline to production in early 2023 is tight.

There are also border restrictions in Australia. Accordingly, modelling is altered to allow for production to commence mid 2023 and the broker applies a 15% escalation in capital expenditure. Outperform rating retained. Target is $8.55.

Target price is $8.55 Current Price is $6.83 Difference: $1.72 If SFR meets the Credit Suisse target it will return approximately 25% (excluding dividends, fees and charges). Current consensus price target is $7.60, suggesting upside of 11.3%(ex-dividends)The company's fiscal year ends in June.

Forecast for FY21:

Credit Suisse forecasts a full year FY21 dividend of 39.22 cents and EPS of 115.00 cents . At the last closing share price the estimated dividend yield is 5.74%. At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.94. How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 101.4, implying annual growth of 136.5%. Current consensus DPS estimate is 34.2, implying a prospective dividend yield of 5.0%. Current consensus EPS estimate suggests the PER is 6.7.

Forecast for FY22:

Credit Suisse forecasts a full year FY22 dividend of 40.11 cents and EPS of 125.00 cents . At the last closing share price the estimated dividend yield is 5.87%. At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.46. How do these forecasts compare to market consensus projections?

Current consensus EPS estimate is 100.1, implying annual growth of -1.3%. Current consensus DPS estimate is 27.9, implying a prospective dividend yield of 4.1%. Current consensus EPS estimate suggests the PER is 6.8.

Market Sentiment: 0.4All consensus data are updated until yesterday. FNArena's consensus calculations require a minimum of three sources