MIN share price in focus
Mineral Resources Limited is a diversified Australian mining company focused on lithium and iron ore extraction across Western Australia.
MIN also provides mining and engineering services for external clients through its wholly-owned subsidiary, CSI Mining Services (CSI). Through CSI, Mineral Resources can provide capital infrastructure and operational expertise to clients across WA, Queensland, and the Northern Territory.
MIN aims to set itself apart from its competitors by maintaining in-house engineering and construction capability that grants full control and flexibility during product development.
Since we consider Mineral Resources Ltd to be a blue chip stock, or a mature business, we like to look at things like return on invested capital (ROIC) and revenue growth as signs of sustainability. In FY24, Mineral Resources Ltd had an ROIC of 3.60% and revenue has compounded at 12.2% in recent years. If a mature business struggles to consistently hit 10% ROIC it could be a sign the business may not be investing its capital effectively. This is just a rule of thumb we follow.
HUB shares
HUB24 was founded in 2007 and has quickly become a leading player in the wealth management industry, providing software and management platforms that touch financial advice, superannuation, and investment management.
HUB24’s three main products are the platforms HUB24, Class, and myprosperity. HUB24 is made for financial advisers and their clients, providing access to a range of managed funds and investment products. Class is a leading software for self-managed super funds to manage portfolios, legal documentation, and compliance. myprosperity is a provider of client portals for accountants and advisers to provide an enhanced service and customer experience.
HUB24’s competitive advantage is in the quality of its service. In 2024 they’ve been awarded Overall Best Platform in the Adviser Ratings Financial Advice Landscape Report, and ranked first for Overall Satisfaction and Brand Image and Reputation in the 2024 Wealth Insights Platform Service Level Report.
MIN share price valuation
We would consider MIN to be a ‘mature’ or ‘blue-chip’ business, so some of the metrics that might be important to us include the debt/equity ratio, average yield, and return on equity, or ROE. For FY24, Mineral Resources Ltd reported a debt/equity ratio of 148.9%, meaning the company is leveraged (it has more debt than equity). This can increase risk so it’s important that a leveraged company has stable returns and the capacity to pay interest on its debts.
Over the last 5 years, MIN has delivered an average dividend yield of 2.4% per year. This is important to note if you’re looking for income from your investments.
Finally, in FY24, MIN reported an ROE of 3.2%. For a mature business you generally want to see an ROE of more than 10%, so MIN’s returns are a bit less than what we’d expect.
As a growth company, some of the trends we would be looking for from HUB shares include revenue growth, profit growth, and return on equity (ROE). Over the last 3 years, HUB has increased revenue at a rate of 44.4% per year to hit $328m in FY24. Meanwhile, net profit has risen from $10m to $47m. HUB’s last reported ROE was 9.2%.
Please keep in mind that context is important – these metrics give us some indication of company performance, but we need a lot more info to work out the value of MIN or HUB shares. To learn more about valuation, I’d recommend signing up for one of our free online investing courses.
