PERENTI LIMITED (PRN)
Share Price Analysis and Chart

25/02/2025

1

Outperform

$1.50

14.07%

Perenti's 1H25 earnings were was -6% below market expectations with a slight 2H skew expected. Perenti notes this is in line with its own expectations and what FY25 guidance is built upon, hence reiteration of FY25 guidance.

Contract Mining in 2H is seasonally stronger due to contractual margin growth, Macquarie notes.

Mining Services will benefit from higher fleet utilisation, and Drilling Services expects some improvement in production with an uptick in junior exploration creating upside risk into FY26.

The earnings trajectory into FY26 is attractive, Macquarie suggests. Target falls to $1.50 from $1.70, Outperform retained.

FORECAST
Macquarie forecasts a full year FY25 dividend of 6.30 cents and EPS of 18.90 cents.
Macquarie forecasts a full year FY26 dividend of 6.70 cents and EPS of 20.60 cents.

03/03/2025

1

Buy

$1.35

2.66%

Perenti delivered seasonally soft cash flow in the first half compounded by some late payments which Canaccord Genuity notes pushed net debt higher by 27%. This is expected to reverse in the second half and the broker forecasts cash conversion of 115%.

Over the next few months clarity will be sought on the major contract and a continuation of the share buyback. FY25 guidance has been reaffirmed with EBITA of $325-345m.

The main focus is on this Zone 5 contract, which the broker estimates currently accounts for around 8% of group earnings. Buy rating unchanged. Target rises to $1.35 from $1.28.

FORECAST
Canaccord Genuity forecasts a full year FY25 dividend of 6.00 cents and EPS of 13.70 cents.
Canaccord Genuity forecasts a full year FY26 dividend of 6.70 cents and EPS of 17.80 cents.