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South32
(Sydney:S32)
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Rating:63Neutral
Price Target:
AU$5.00
▲(10.38% Upside)
Action:Reiterated
Date:03/26/26
The score is driven primarily by stable-but-mixed financial performance (strong margins and low leverage, but weak net profitability and pressured free cash flow). Valuation is supportive (low P/E with a dividend), while technical indicators are notably bearish and weigh on the overall score. The latest earnings call adds modest support due to strong interim results and capital returns, tempered by material aluminum/power and project execution risks.
Positive Factors
Conservative leverage
A low debt-to-equity ratio (0.18) signals conservative leverage, reducing refinancing and solvency risk. Over the next 2-6 months this balance-sheet strength supports continued dividend programs, selective project funding and resilience to commodity-price or cost shocks without forced asset sales.
Negative Factors
Thin net profitability
Low net margin and weak ROE show limited ability to convert revenue into shareholder returns. Over months this constrains internal reinvestment and leaves less buffer against commodity price or cost shocks, increasing dependence on favorable cycles or external capital for growth.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative leverage
A low debt-to-equity ratio (0.18) signals conservative leverage, reducing refinancing and solvency risk. Over the next 2-6 months this balance-sheet strength supports continued dividend programs, selective project funding and resilience to commodity-price or cost shocks without forced asset sales.
Read all positive factors
South32 (S32) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$21.30B
Dividend Yield1.95%
Average Volume (3M)22.65M
Price to Earnings (P/E)50.1
Beta (1Y)1.34
Revenue Growth2.25%
EPS Growth97.21%
CountryAU
Employees8,892
SectorBasic Materials
Sector Strength58
IndustryIndustrial Materials
Share Statistics
EPS (TTM)N/A
Shares Outstanding4,486,486,000
10 Day Avg. Volume27,687,413
30 Day Avg. Volume22,651,275
Financial Highlights & Ratios
PEG Ratio-0.20
Price to Book (P/B)0.98
Price to Sales (P/S)1.49
P/FCF Ratio26.01
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$5.00Price Target Upside10.27% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering10
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
South32 Business Overview & Revenue Model
Company Description
South32 Limited (S32) is a diversified mining and metals company that produces and sells commodities including alumina and aluminium, copper, zinc, lead, silver, metallurgical coal, manganese, and nickel. The company operates a portfolio of mines,...
How the Company Makes Money
South32 makes money by producing commodities from its operated assets (and, in some cases, through interests in jointly owned operations) and selling those commodities to customers at prevailing market prices, typically under a mix of spot sales, ...
South32 Financial Statement Overview
Summary
Income Statement
65
Positive
Balance Sheet
70
Positive
Cash Flow
55
Neutral
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 5.46B | 5.78B | 5.48B | 5.65B | 9.27B | 5.48B |
| Gross Profit | 2.45B | 2.52B | 1.86B | 1.94B | 5.46B | 2.57B |
| EBITDA | 835.59M | 1.34B | 141.00M | 416.00M | 4.47B | 1.47B |
| Net Income | 304.09M | 213.00M | -203.00M | -173.00M | 2.67B | -195.00M |
Balance Sheet | ||||||
| Total Assets | 13.80B | 13.73B | 14.24B | 14.56B | 16.34B | 13.24B |
| Cash, Cash Equivalents and Short-Term Investments | 1.66B | 1.68B | 842.00M | 1.26B | 2.37B | 1.61B |
| Total Debt | 1.69B | 1.63B | 1.57B | 1.74B | 1.83B | 1.21B |
| Total Liabilities | 4.54B | 4.87B | 5.27B | 5.19B | 5.56B | 4.29B |
| Stockholders Equity | 9.24B | 8.85B | 8.96B | 9.38B | 10.78B | 8.96B |
Cash Flow | ||||||
| Free Cash Flow | 388.87M | 332.00M | -2.00M | 303.00M | 2.48B | 815.00M |
| Operating Cash Flow | 1.44B | 1.33B | 1.12B | 1.19B | 3.07B | 1.41B |
| Investing Cash Flow | -899.69M | -20.00M | -1.11B | -908.00M | -2.10B | -608.00M |
| Financing Cash Flow | -478.90M | -405.00M | -417.00M | -1.39B | -215.00M | -501.00M |
South32 Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
63 Neutral | AU$21.30B | 50.09 | 3.36% | 2.67% | 2.25% | 97.21% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
55 Neutral | AU$13.00B | 32.35 | 11.50% | ― | 3.58% | ― | |
49 Neutral | AU$5.96B | -28.68 | -9.95% | ― | -36.60% | 80.62% | |
48 Neutral | AU$3.05B | -10.58 | -12.75% | 0.84% | -13.24% | -223.96% | |
45 Neutral | AU$3.58B | -43.93 | -2.79% | ― | -3.26% | 66.55% | |
44 Neutral | AU$15.70B | -162.33 | -2.64% | ― | 4.86% | -177.78% |
* Basic Materials Sector Average
AU:S32
South32
4.76
1.95
69.21%
AU:PLS
PLS Group
4.87
2.60
114.54%
AU:ILU
Iluka Resources Limited
7.09
0.67
10.45%
AU:IGO
IGO
7.89
2.44
44.77%
AU:MIN
Mineral Resources Limited
65.99
28.87
77.77%
AU:NIC
Nickel Mines Ltd.
0.83
0.08
10.74%
South32 Corporate Events
South32 Lapses 868,931 Conditional Rights, Tightens Future Capital Base
Jul 9, 2026
South32 Limited has reported the lapse of 868,931 conditional rights to securities under the ASX code S32AA, after the conditions attached to these rights were not met or became incapable of being satisfied by 30 June 2026. The cessation of these ...
South32 issues 203,927 new shares from converted unquoted securities
Jul 9, 2026
South32 Limited has notified the market of the issue of 203,927 fully paid ordinary shares following the conversion or exercise of previously unquoted equity securities. The new shares, issued on 30 June 2026, modestly increase the company’s...
South32 Issues New Unquoted Rights Under Employee Incentive Scheme
Jul 9, 2026
South32 Limited has notified the market of the issue of 116,115 unquoted rights securities under its employee incentive scheme, effective 30 June 2026. The new rights, which are not intended to be quoted on the ASX, reflect the company’s ong...
South32 Discloses Initial Shareholdings of Incoming Director Matthew Daley
Jul 1, 2026
South32 has disclosed the initial securities interests of newly appointed director Matthew Daley, who will join the board on 1 July 2026, in line with regulatory requirements. Daley holds 3,197,143 performance rights granted under the South32 Equi...
South32 Details Final Director Interest Notice for Departing CEO Graham Kerr
Jul 1, 2026
South32 has disclosed a final director’s interest notice for outgoing chief executive and managing director Graham Kerr, who ceased to be a director on 30 June 2026. The filing details his remaining holdings in the company, including ordinar...
Alcoa to Buy South32 Aluminum Assets in $4.1 Billion Upstream Expansion
Jun 30, 2026
Alcoa has agreed to acquire South32’s bauxite, alumina, and aluminum assets in a cash-and-stock deal valued at about $4.1 billion, implying an enterprise value of roughly $4.7 billion including net debt. The transaction will add low-cost, gl...
South32 greenlights high-return expansion at Chile’s Sierra Gorda copper mine
Jun 30, 2026
South32’s Sierra Gorda joint venture in northern Chile has approved a brownfield expansion to add a fourth grinding line, following a feasibility study that confirmed attractive returns from the project. The investment will increase processi...
South32 to Exit Aluminium Chain as It Sharpens Focus on Base Metals
Jun 30, 2026
South32 has outlined plans to sell its aluminium value chain assets as it reshapes itself into an upstream base metals-focused company, signalling a strategic shift toward growth in projects such as Cannington and the Hermosa development. The rele...
South32 Sells Aluminium Assets to Alcoa in US$5.6bn Pivot to Base Metals
Jun 30, 2026
South32 has agreed to sell its aluminium value chain assets, including major interests in Worsley Alumina, Hillside Aluminium and Brazilian bauxite and refining operations, to Alcoa for an implied enterprise value of up to US$5.6 billion, with Alc...
South32 outlines strategy update ahead of global metals conference
May 12, 2026
South32 has released a new strategy and business update ahead of a scheduled presentation by chief executive Graham Kerr at BofA Securities’ Global Metals, Mining Steel Conference on 13 May 2026. The update and accompanying webcast, availab...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.