Iron Ore Likely to Keep Driving Deterra's Earnings
Deterra Royalties aims to grow into a diversified royalty company with multiple cash flows. The acquisition of Trident Royalties is likely the first of additional royalty and/or streaming purchases.
Deterra Royalties Ltd Ordinary Shares DRR
Bulls Say, Bears Say
Bulls
Deterra has no exposure to operating or capital costs, which makes for a much lower-risk mining exposure.
Bears
Chinese demand for iron ore is likely to soften as declining returns from fixed-asset investment necessitate a structural shift.
Trading Information
- Previous Close Price
- A$4.04
- Day Range
- A$4.00–4.05
- 52-Week Range
- A$3.67–4.78
- Bid/Ask
- A$4.00 / A$4.06
- Shares Outstanding
- 531.77M
- Market Cap
- A$2.15B
- Volume/Avg
- 3M / 2M
Key Statistics
- Price/Earnings (Normalized)
- 14.42
- Price/Sales
- 8.84
- Dividend Yield (Trailing)
- 5.74%
- Dividend Yield (Forward)
- 5.35%
- Dividend Payment Schedule
- Mar, Sep
- Total Yield
- 5.74%
Company Profile
Deterra Royalties was spun out from Iluka Resources in October 2020, with Iluka retaining a 20% interest. Its only material income-generating asset is a royalty covering iron ore produced by BHP from the Mining Area C royalty area in Western Australia. This includes the North Flank mine, producing around 60 million metric tons of iron ore a year, and the South Flank mine, which produces around 80 million metric tons. It also covers most of the Tandanya and Mudlark deposits, which BHP intends to develop in the longer term as part of its plan to operate the MAC production hub for at least 50 years. Consistent with its strategy to grow into a diversified royalty firm, its Trident Royalties purchase is likely to provide modest diversification from iron ore.
- Sector
- Basic Materials
- Industry
- Other Industrial Metals & Mining
- Stock Style Box
- Small Core
- Total Number of Employees
- —
- Website
- https://www.deterraroyalties.com
Competitors
Valuation
|
Metric
|
DRR
|
BHP
|
FMG
|
|---|---|---|---|
Price/Earnings (Normalized) | 14.42 | 14.68 | 9.22 |
Price/Book Value | 15.00 | 4.37 | 1.70 |
Price/Sales | 8.84 | 3.67 | 2.02 |
Price/Cash Flow | 12.63 | 9.19 | 5.00 |
Price/Earnings
DRR
BHP
FMG
Financial Strength
|
Metric
|
DRR
|
BHP
|
FMG
|
|---|---|---|---|
Quick Ratio | 16.07 | 1.44 | 1.70 |
Current Ratio | 16.52 | 1.88 | 2.32 |
Interest Coverage | 17.84 | 11.36 | 13.01 |
Quick Ratio
DRR
BHP
FMG
Profitability
|
Metric
|
DRR
|
BHP
|
FMG
|
|---|---|---|---|
Return on Assets (Normalized) | 0.04% | 11.44% | 11.10% |
Return on Equity (Normalized) | 0.11% | 27.20% | 17.01% |
Return on Invested Capital (Normalized) | 2.52% | 17.58% | 13.71% |
Return on Assets
DRR
BHP
FMG
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United States