The average target price of MM8.AX is 0.50 and suggests 108% upside potential. Usually, this means a BUY recommendation among investment firms, or a recommendation to increase one's position in this instrument in the next 12 months. The most optimistic analyst has a target price of 0.7. This translates into 171% upside potential in the best case. On the other hand, the most pessimistic analyst has a target price of 0.4. This suggests 71% upside potential. Even the most pessimistic analyst believes there will be stock growth. 

Medallion Metals Limited engages in mineral exploration activities in Australia. The company primarily explores for gold, silver, copper, lead, and zinc deposits. Its flagship property is the 100% owned Ravensthorpe gold project covering an area of approximately 300 square kilometers located in Western Australia. The company was incorporated in 2015 and is based in West Perth, Australia.

Australia

Medallion Metals Limited

Basic Materials

The company does not pay dividends at all, or it pays them sporadically. There have only been a few years with dividend payments in the past ten years. 

MM8.AX reported revenue of AUD 1mn in the last 12 months, down 44% from FY23. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. EPS fell 100% from FY23 to AUD 0.00. Market expects EPS to reach AUD -0.01 in FY25.

Over the last six months, the stock performance has varied, with an increase following a drop. The stock's price trend wasn't definitive when matched against its global counterparts from the same sector and industry (as depicted above). Over the past six months the stock has exceeded the performance of this peer group by 36ppts and its growth decelerated by 11ppts in the past month. This is equally valid for peers from the same country and industry. Given the stock's valuation versus its peers, its total price movement is mildly favourable.

The company has reported very poor EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to -163.0% in the last 12 months, a decline from -138.8% in FY24. 

Historically, MM8.AX has reported very poor net margins compared to its global peers. Specifically, in the last 12 months, this metric equalled -237.6%, down from -158.2% in FY24. 

Medallion Metals Limited reported a return on equity (RoE) of -25.9% in the last 12 months, down from -23.1% in FY24. The market consensus projects an RoE of -26.2% in FY25, again behind its peers. 

Another important profitability metric, return on assets (RoA), amounted to -19.1% in the last 12 months, a decrease from -17.1% in FY24. The market analysts predict that RoA will be -19.1% in FY25, again weaker than its peers. 

In the last 12 months, the return on capital employed (RoCE) declined to -20.4%, below the peers. The consensus estimate for FY25 for RoCE is -18.7%, again behind the peers. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been -4.2 in the past several years. This ratio implies a fragile shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are minimal. In combination with stringent business standards, shareholder rights are very highly protected.

MM8.AX has very poor trading liquidity. It will take considerable time for the average private investor to sell a common position under normal market conditions. Liquidity may be unstable and becomes extremely unfavourable on the days with the lowest activity. However, under highly turbulent market conditions, the trading volume tends to improve significantly. Another factor to consider is the substantial number of days with zero trading volumes, i.e., without any ability to sell a position. The stock has a tiny market capitalisation, which usually makes its trading liquidity erratic and unpredictable. 

No other major risks have been identified.

The risk of default is high. Among the negative credit factors, we point to weak positions in its industry, bleak profitability, negligible return on capital, poor working capital management, inadequate interest coverage, and poor cash flow generation. We note resilient historical revenue growth, low margin volatility, and an favourable capital structure, among the positive credit factors. 

In highly turbulent market conditions, MM8.AX is exceptionally volatile. In other words, the stock will be among the worst-performers in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be critical. 

In normal market circumstances, MM8.AX is exceptionally volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will change quite unpredictably. The stock's losses on its worst days (less than 1-5% of the time) will range from critical to immense. 

Based on key historical and expected multiples, the stock is greatly overvalued relative to its peers. 

Medallion Metals Limited

A$ 0.24

2

Medallion Metals Limited

A$ 0.24

2

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

A$ 0.24

About

About

About

About