Weekly Reports | 10:00 AM
This week's In Brief shines a light on two companies in the sweet spot of silver and mining, with two others facing challenges.
- Tasmea positioned to benefit from Australia’s ageing mining, infrastructure cycle
- Fully funded Sorby Hills project highlights Boab’s leverage to rising silver prices
- Cedar Woods sales remain resilient but are macro and cost pressures looming?
- Pexa Group outlook clouded by IPART pricing uncertainty
By Danielle Ecuyer
This week's quote comes from Commvault’s State of Data Resilience – Australia and New Zealand, 6th Edition (2026).
"(...) many organisations across Australia and New Zealand (ANZ) are rapidly embedding AI into critical business operations, often without adequate safeguards in place to manage risks introduced by AI agents and AI-driven applications."
Ageing assets and a pending specialist labour shortage
Canaccord Genuity initiated coverage of Tasmea ((TEA)), emphasising the industrial services group (market cap $1.5bn) is positioned in the slipstream of growth across resources and infrastructure end markets in Australia.
Some 70% of the company’s revenue is generated from mining and resource customers, with iron ore the largest exposure at around 38%.
The Pilbara is the key geographic location, with the region’s last major capex cycle occurring in 2007-2013, resulting in ageing assets between ten and twenty years old-plus.
Ageing infrastructure is flagged to underpin what the broker believes is a structural uplift in prolonged spending and maintenance intensity.
Against this backdrop, demand for Tasmea’s services is expected to lift. A shortage of skilled labour and increasing investment in electrical and transmission infrastructure also support Tasmea’s in-demand profile.
The broker points to the recent WorkPac acquisition in November last year as boosting the company’s ambitions to scale into a more challenging and supply-constrained labour market.
Notably, WorkPac can bring forth an acceleration in the speed and scale of moving labour across the company’s subsidiaries, thereby improving the pace of new contract wins and lowering dependence on subcontractors.
Australia, like many countries, is upgrading its infrastructure, specifically across transmission networks as well as Brisbane Olympic-related works.
Access to labour for tenders is becoming more important and offers a competitive advantage.
The stock is Buy rated with a $5.59 target.
A "silver" entry point
Shaw and Partners has retained its Buy rating for Boab Metals ((BML)) post release of the company's March quarter report.
Construction of the Sorby Hills silver-lead project continued to progress over the period and is now fully financed, with Boab completing both equity and debt raisings over the quarter.
The analyst highlights production of first concentrate is now around 15 months away in 2H27, with early works started and a letter of intent issued to the preferred contractor for the DeGrussa Plant disassembly, relocation and reconstruction.
Shaw details the expected financial metrics for the project, including capex of -$264m, negative AISC of -US$14/oz payable silver post lead credits, a pre-tax net present value of $596m and a pre-tax internal rate of return of 47%.
For good measure: a negative AISC occurs when the value of the lead by-product more than covers the cost base allocated to silver. So the accounting cost of each payable ounce of silver becomes negative (thus a positive for the company's bottom-line).
Estimated annual earnings (EBITDA) are $160m. The analyst stresses the project’s metrics look considerably better at spot commodity prices.
Boab is one of limited options for investors to gain exposure to silver on the ASX. Sorby Hills is viewed as an “advanced and robust project”, including one of the largest silver resources at 53Moz.
On average, the project is expected to produce 2.2Moz of silver annually and, at the current silver price of US$73/oz, that equates to cash flow generation of $270m (US$190m).
Shaw retains a Buy rating, ascribed High risk, and a target price of $1.40.
The recent sell-off in the share price is attributed to the ‘risk-off’ tone in the market due to the Middle East war. Boab is currently trading at less than 1x first full-year cash flow.
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