Mineral Resources stock downgraded by JPMorgan on valuation concerns

Published 30/07/2025, 11:46
Mineral Resources stock downgraded by JPMorgan on valuation concerns

Investing.com - JPMorgan downgraded Mineral Resources Limited (ASX:MIN) stock rating from Neutral to Underweight while raising its price target to AUD24.00 from AUD19.00.

The downgrade comes despite what JPMorgan described as a "solid quarter" for the Australian mining company, with fiscal year 2025 net debt of $5.35 billion coming in below the firm’s $5.7 billion estimate, benefiting from foreign exchange gains and better Mining Services volumes.

Mineral Resources reported Mining Services volumes of 83 million tonnes, exceeding JPMorgan’s estimate by 8%, while lithium shipments of 135,000 tonnes also beat expectations by 8% with an achieved spodumene price of $543 per tonne broadly in line with forecasts.

For fiscal year 2026, the company provided guidance of 30-33 million tonnes of shipments, which aligns with market consensus, and capital expenditure guidance of approximately $1 billion, in line with Bloomberg consensus estimates.

JPMorgan maintained its underlying fiscal year 2025 loss forecast at $320 million but narrowed its fiscal year 2026 loss projection from $78 million to $17 million after including mark-to-market adjustments for lithium prices, with the downgrade reflecting valuation concerns as the stock has doubled from its April lows compared to a 19% rise in the ASX200.

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