Yahoo Finance Mincor Resources NL (ASX:MCR) About To Shift From Loss To Profit
With the business potentially at an important milestone, we thought we'd take a closer look at Mincor Resources NL's (ASX:MCR) future prospects. Mincor Resources NL, together with its subsidiaries, engages in the exploration, evaluation, development, and mining of mineral resources in Australia. The AU$810m market-cap company announced a latest loss of AU$15m on 30 June 2022 for its most recent financial year result. The most pressing concern for investors is Mincor Resources' path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
Check out our latest analysis for Mincor Resources
According to the 4 industry analysts covering Mincor Resources, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2022, before generating positive profits of AU$67m in 2023. So, the company is predicted to breakeven approximately 12 months from now or less. We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 57% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.
Given this is a high-level overview, we won’t go into details of Mincor Resources' upcoming projects, but, take into account that by and large metals and mining companies, depending on the stage of operation and metals mined, have irregular periods of cash flow. This means that a high growth rate is not unusual, especially if the company is currently in an investment period.
Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital judiciously, with debt making up 29% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.
Next Steps:
This article is not intended to be a comprehensive analysis on Mincor Resources, so if you are interested in understanding the company at a deeper level, take a look at Mincor Resources' company page on Simply Wall St. We've also compiled a list of important factors you should look at:
Valuation: What is Mincor Resources worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Mincor Resources is currently mispriced by the market.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Mincor Resources’s board and the CEO’s background.
Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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