South32 Ltd (S32) Earnings Report: 1H Net Income Hits $53M, Revealing Strong Revenue and Dividend Increases

South32 Ltd on Smartkarma

According to analysts on Smartkarma, South32 Ltd, an Australian metal and mining company, has been facing a decline in its share price. However, Pranay Yadav believes that the company’s focus on facilitating the energy transition and its diversified regional exposure make it a compelling investment opportunity. South32’s primary revenue source is its aluminum operations, followed by coking coal operations, which contribute to 32% of the underlying EBITDA. With its current low share price, South32 could potentially be a good long-short trade.

David Blennerhassett, another analyst on Smartkarma, agrees that South32 is making efforts to reshape its low-carbon footprint. Since being spun off from BHP in 2015, the company has been actively addressing its vast asset portfolio. However, there have been some challenges, such as a writedown in the Hermosa base metals project due to inflationary pressure. Blennerhassett notes that South32 is also focused on commodities related to the energy transition, which could lead to divestment of coal assets and acquisition of copper or lithium assets. Although he has a slightly positive outlook on the company, it is not a strong conviction trade idea.

A look at South32 Ltd Smart Scores

Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma

South32 Ltd, a diversified metals and mining company, has a positive long-term outlook based on its Smartkarma Smart Scores. With a score of 4 for value, the company is seen as undervalued compared to its peers. This could potentially make it an attractive investment for those looking for a bargain. In terms of dividends, South32 scores a 3, indicating a moderate level of payout to shareholders. This could be seen as a stable source of income for investors. However, the company scores lower on growth and resilience, with scores of 2 and 3 respectively. This suggests that South32 may not be a high-growth company and may face some challenges in the future. Its momentum score of 3 indicates a steady performance in the market. Overall, South32 Ltd seems to be a solid company with potential for value and dividends, but may not be a high-growth stock.

Disclaimer: This article by Smartkarma is general in nature and 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. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
Have feedback on this article? Concerned about the content? Get in touch with us directly.

💡 Before it’s here, it’s on Smartkarma