Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.
Appreciate MM’s interest in S32 at the appropriate price. After today’s full year result and the further sell-off where does MM see value emerge to initiate an entry position. It appears to only be ~4% off 52 week lows. Is S32 a stock you’d consider as a long term hold in a resources allocation to a diversified portfolio among - BHP, MIN, S32, RIO?
Hi Scott,
We continue to watch S32 with the view of buying, but we’ve held off for now which has been the right call, the trend is clearly on the downside. S32’s results and operational performance were solid in FY23, however, like the majority of mining companies’ cost pressures are being stubborn while S32 have the added impost of lower volumes in some divisions likely in FY24.
Overall, performance is okay, they remain disciplined with capital allocation, balancing cash returns to shareholders and they have some growth optionality. So yes, it remains on our radar, although we’re not big on making calls about long-term time frames – things can change and we may need to change with them!
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