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IGO (AU:IGO)
ASX:IGO

IGO (IGO) AI Stock Analysis

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AU

IGO

(Sydney:IGO)

Rating:61Neutral
Price Target:
AU$4.50
▲( 10.57% Upside)
IGO's overall stock score reflects a challenging financial environment with declining revenues and profitability concerns, offset by strong cash flow and a robust balance sheet. Technical indicators and valuation metrics are mixed, suggesting caution. The earnings call highlighted significant operational challenges, impacting future performance expectations.

IGO (IGO) vs. iShares MSCI Australia ETF (EWA)

IGO Business Overview & Revenue Model

Company DescriptionIGO Limited (IGO) is an Australian-based mining and exploration company primarily involved in the extraction and production of nickel, copper, and cobalt. The company operates across several sectors, including mining, processing, and exploration of mineral resources. IGO's core assets include its 100% owned Nova Operation, a prominent producer of nickel, copper, and cobalt located in Western Australia, and interests in joint ventures and exploration projects focused on discovering and developing critical minerals essential for clean energy technologies.
How the Company Makes MoneyIGO Limited generates revenue through the sale of mined and processed minerals, specifically nickel, copper, and cobalt, from its Nova Operation. The company benefits from long-term supply contracts with global customers, ensuring a steady revenue stream. Additionally, IGO invests in exploration activities to discover new mineral deposits, which could lead to future revenue growth. Strategic partnerships and joint ventures provide further opportunities for expansion and diversification of its revenue sources, allowing IGO to capitalize on rising demand for critical minerals used in clean energy technologies.

IGO Financial Statement Overview

Summary
IGO presents a mixed financial picture. The income statement reflects declining revenue and profit margins, raising concerns about cost control and market conditions. However, the balance sheet is strong, with low leverage and a high equity buffer, offering stability. Cash flow remains healthy, underscoring solid cash generation capabilities. The company needs to address revenue and margin challenges to enhance its overall financial performance.
Income Statement
55
Neutral
The income statement shows a significant decline in revenue from 2023 to 2024, with total revenue dropping from 1049.9M to 796.4M AUD. Gross profit turned negative in 2024, indicating cost management issues or pricing pressures. Despite positive net income in 2024, the EBIT margin has become negative, reflecting operational inefficiencies. Revenue and profit margins have been unstable, posing a risk to financial health.
Balance Sheet
75
Positive
The balance sheet is relatively strong with a high equity ratio and low debt, indicating financial stability. The debt-to-equity ratio is favorable at 0.015, suggesting low leverage. However, stockholders' equity has decreased slightly from 2023 to 2024, which may indicate some erosion of value. Overall, the company's balance sheet provides a stable financial foundation despite recent performance challenges.
Cash Flow
80
Positive
Cash flow statements indicate solid operating cash flow with 872M AUD in 2024, supporting strong free cash flow generation. Free cash flow, however, has decreased from the previous year, highlighting potential challenges in sustaining free cash generation levels. The operating cash flow to net income ratio is robust, indicating good cash conversion efficiency. Overall, cash flow remains a strong aspect of the company's financials.
Breakdown
TTMJun 2024Jun 2023Jun 2022Jun 2021Jun 2020
Income StatementTotal Revenue
671.80M796.40M1.05B845.20M619.86M580.14M
Gross Profit
20.80M-134.60M203.20M327.30M151.74M105.19M
EBIT
-140.50M-183.60M140.00M297.30M121.73M73.34M
EBITDA
-309.20M144.80M-592.20M468.40M358.66M296.66M
Net Income Common Stockholders
-1.07B2.80M549.10M330.90M163.84M155.09M
Balance SheetCash, Cash Equivalents and Short-Term Investments
291.40M530.40M837.60M493.90M639.46M618.07M
Total Assets
2.48B3.57B4.74B4.86B3.61B2.29B
Total Debt
43.20M48.70M432.10M959.20M25.05M96.72M
Net Debt
-203.40M-419.30M-343.10M592.10M-503.47M-413.59M
Total Liabilities
212.90M357.50M947.70M1.43B408.86M367.22M
Stockholders Equity
2.27B3.21B3.79B3.44B3.20B1.93B
Cash FlowFree Cash Flow
299.50M673.10M1.05B300.30M351.34M309.85M
Operating Cash Flow
315.40M872.00M1.39B388.40M446.05M397.52M
Investing Cash Flow
-14.80M-240.30M-293.60M-1.28B-1.06B-115.34M
Financing Cash Flow
-311.00M-943.70M-726.70M761.80M633.00M-116.96M

IGO Technical Analysis

Technical Analysis Sentiment
Negative
Last Price4.07
Price Trends
50DMA
3.91
Positive
100DMA
4.34
Negative
200DMA
4.74
Negative
Market Momentum
MACD
0.11
Negative
RSI
51.37
Neutral
STOCH
25.77
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:IGO, the sentiment is Negative. The current price of 4.07 is above the 20-day moving average (MA) of 4.05, above the 50-day MA of 3.91, and below the 200-day MA of 4.74, indicating a neutral trend. The MACD of 0.11 indicates Negative momentum. The RSI at 51.37 is Neutral, neither overbought nor oversold. The STOCH value of 25.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:IGO.

IGO Peers Comparison

Overall Rating
UnderperformOutperform
Sector (50)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
AUIGO
61
Neutral
$3.13B1,418.92-36.53%6.46%-28.50%-532.61%
AUS32
54
Neutral
£13.76B60.96-3.53%3.47%-19.74%
AUMIN
51
Neutral
$4.70B50.78-33.95%4.54%2.22%-411.10%
50
Neutral
$2.00B-1.02-21.34%3.70%2.00%-30.65%
AUPLS
46
Neutral
$4.44B23.42-1.04%-65.07%-102.37%
AUSYR
44
Neutral
$380.42M-33.63%-33.27%-10.07%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
AU:IGO
IGO
4.07
-3.14
-43.51%
AU:S32
South32
3.08
-0.66
-17.56%
AU:MIN
Mineral Resources Limited
23.51
-53.22
-69.36%
AU:PLS
Pilbara Minerals
1.37
-2.64
-65.88%
AU:SYR
Syrah Resources
0.34
-0.15
-30.93%

IGO Earnings Call Summary

Earnings Call Date:Feb 19, 2025
(Q2-2025)
|
% Change Since: -12.28%|
Next Earnings Date:Aug 28, 2025
Earnings Call Sentiment Negative
The earnings call highlighted strong performance and improvements in Greenbushes and safety indicators. However, these positives are overshadowed by significant challenges at Nova and Kwinana, including production issues, financial losses, and strategic setbacks such as the suspension of Train 2. The lack of expected dividends from TLEA also presents a cash flow concern.
Q2-2025 Updates
Positive Updates
Strong Greenbushes Performance
Greenbushes had another strong quarter of production, finishing the calendar year well and beating internal plans. The operation is continuing to improve with good recoveries and strong margins despite being at a low point in the cycle.
Safety Improvements
Progress in safety maturity is noted, with leading indicators starting to show improvement, marking a positive trend for future operational safety.
Negative Updates
Nova Production Challenges
Nova experienced a tough quarter with lower nickel output due to mine grade issues and plant availability problems, compounded by a subdued nickel price impacting financials.
Kwinana Financial Struggles
Kwinana's EBITDA loss resulted from NRV adjustments on spodumene and lithium hydroxide inventories due to weaker market conditions and built-up inventories, which were slower to sell than expected.
Kwinana Train 2 Decision
The decision to cease activities around Train 2 was made after evaluating CapEx and OpEx, impacting future expansion plans and leading to ongoing impairment testing for Train 1.
No Expected Dividends from TLEA
The company does not expect to receive any dividends from TLEA in the second half of the financial year, impacting cash flow expectations.
Company Guidance
During the IGO Limited December Quarter Results Call, Ivan Vella, Managing Director and CEO, provided detailed guidance across several business areas. The company reported a strong quarter for its lithium business, particularly at Greenbushes, with production exceeding plans despite a slow start to the calendar year. Vella highlighted ongoing optimization and improvement work, including the CGP3 project, which is on track. At Kwinana, production improved following a shutdown, but the company has ceased activities around Train 2, impacting financials with an expected impairment. Nova faced challenges with lower nickel output due to mine grade issues and plant availability, which affected financials alongside subdued nickel prices. Sales at Greenbushes were down due to shipment timing, not demand, and the company remains optimistic about productivity improvements and sustaining recoveries. The cash position ended at $247 million, with exploration spending trending down, and IGO does not expect dividend payments from TLEA in the second half of the financial year.

IGO Corporate Events

Ubique Asset Management Increases Stake in IGO Limited
May 16, 2025

Ubique Asset Management Pty Ltd has increased its stake in IGO Limited, an Australian company, from 6.33% to 7.43% by acquiring additional shares. This change in substantial holding reflects a strategic move by Ubique Asset Management, potentially indicating confidence in IGO’s market position and future prospects.

The most recent analyst rating on (AU:IGO) stock is a Hold with a A$3.50 price target. To see the full list of analyst forecasts on IGO stock, see the AU:IGO Stock Forecast page.

IGO Limited Director Acquires Shares, Signaling Strategic Governance Move
May 8, 2025

IGO Limited announced a change in the director’s interest, with Director Samantha Hogg acquiring 20,000 ordinary shares through an on-market trade valued at $77,969.66. This acquisition reflects a strategic move in the company’s governance, potentially impacting its market perception and stakeholder confidence.

IGO Limited Announces Director’s Interest Change
May 8, 2025

IGO Limited has announced a change in the director’s interest, specifically involving Mr. Michael Peter Nossal. The change includes the acquisition of 10,000 shares through an on-market trade and the transfer of 75,000 shares from direct ownership to MPJN Nominees Pty Ltd ATF Michael Nossal Superannuation Fund. This adjustment results in Mr. Nossal holding a total of 110,000 ordinary shares. The transaction reflects strategic financial management within the company, potentially impacting its governance and shareholder dynamics.

IGO Limited Director Increases Shareholding, Signaling Confidence in Future
May 8, 2025

IGO Limited has announced a change in the director’s interest, with Ivan Vella acquiring additional shares in the company. This acquisition reflects a significant personal investment by the director, potentially indicating confidence in the company’s future performance and stability, which may positively impact stakeholders’ perceptions and the company’s market positioning.

IGO Limited Announces Director’s Interest Change
May 8, 2025

IGO Limited announced a change in the director’s interest, with Ivan Vella acquiring additional performance and service rights. This change reflects the company’s ongoing commitment to aligning executive interests with shareholder value, potentially impacting IGO’s operational strategies and market positioning.

Medallion Metals Revises Forrestania Acquisition Terms with IGO
May 5, 2025

Medallion Metals Limited, in collaboration with IGO Limited, has revised the terms of their agreement regarding the acquisition of the Forrestania Nickel Operation. Under the new terms, Medallion will acquire full ownership of the operation, including tenements, infrastructure, and other assets, while IGO retains rights to explore and mine nickel and lithium. This strategic move aims to enhance Medallion’s gold production capabilities, leveraging existing infrastructure to unlock value and potentially reestablish the region as a significant gold production district. The transaction is set to be completed by late 2025, contingent on various conditions, including a positive investment decision on the Ravensthorpe Gold Project.

IGO Limited Reports Strong Q3 2025 Results with Solid Operational Performance
Apr 30, 2025

IGO Limited reported solid operational results for the third quarter of 2025, with significant production and strong margins at Greenbushes, and improved production and lower costs at Nova. The company also announced a US$110 million dividend from Windfield Holdings and a strong financial position with underlying EBITDA of $34 million and cash reserves of $284 million, signaling robust financial health and strategic operational improvements.

IGO Limited Reports Strong Quarterly Performance Amid Operational Adjustments
Apr 30, 2025

IGO Limited reported a solid operating quarter with significant financial and operational achievements. The Greenbushes mine delivered strong margins and cash flows, while Nova recorded improved production. Despite challenges at the Kwinana Lithium Hydroxide Refinery, the company maintained a robust balance sheet with a net cash position of $284 million. The implementation of a new exploration business model led to a rationalization of the tenement portfolio, reflecting IGO’s commitment to growth through exploration.

IGO Limited Announces March Quarterly Results Webcast
Apr 23, 2025

IGO Limited has announced that it will hold a live webcast for its March 2025 Quarterly Report presentation on April 30, 2025. This event will provide investors with insights into the company’s recent performance and strategic direction. The webcast will be accessible online, and a recording will be available on IGO’s website following the live event. This initiative underscores IGO’s commitment to transparency and effective communication with its stakeholders.

IGO Limited Announces Leadership Changes with CFO and Chief People Officer Departures
Apr 7, 2025

IGO Limited announced the resignation of its Chief Financial Officer, Kathleen Bozanic, who will retire in December 2025 to pursue a non-executive career. Bozanic, who has been with IGO since 2022, has played a crucial role in guiding the company through recent challenges and positioning it for future success. Additionally, Chief People and Sustainability Officer Sam Retallack will also be leaving the company in early Q3 2025 after 13 years, having significantly contributed to the development of the company’s purpose and values. These leadership changes are expected to impact the company’s operations and strategic direction.

Schroder Investment Management Acquires Substantial Stake in IGO Ltd
Mar 25, 2025

Schroder Investment Management Australia Ltd has become a substantial holder in IGO Ltd, acquiring a 5.97% voting power through its related bodies corporate. This acquisition reflects a significant investment in IGO Ltd, potentially influencing its strategic direction and market perception, as Schroder’s involvement may bring additional expertise and resources to the company.

State Street Increases Stake in IGO Limited
Mar 5, 2025

IGO Limited has reported a change in the substantial holding of its voting shares, with State Street Corporation and its subsidiaries increasing their voting power from 6.69% to 8.23%. This change in voting power indicates a significant shift in the control dynamics within the company, potentially impacting its strategic decisions and influencing stakeholder interests.

IGO Limited Revises Greenbushes Lithium Resource Estimates
Feb 25, 2025

IGO Limited has revised its Greenbushes CY24 Resources and Reserves report, addressing previous misinterpretations regarding mineral resource schematics and making minor amendments. The report highlights a 2% decrease in mineral resource estimates due to mining depletion, with significant lithium concentrate production aimed at electric vehicle and energy storage markets. The company is undertaking a strategic options review to maximize asset value and align reporting across different regimes, while drilling efforts have increased confidence in high-grade mineralization at depth.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.