Key points:
- Buy Mineral Resources shares as the stock breaks out of a six-week consolidation base on strong volume following the positive Q1 FY23 trading update. The company is Australia’s largest mining contractor that is moving down the value chain in the high growth Li processing industry and has good forward visibility due to locked-in iron ore projects.
- Fundamental profile: EPS Rank 72, Composite Rating of 96, and SMR Rating of C. For FY23, consensus expects revenue and EPS growth of 87% and 380%, respectively, supported by the Li business.
- Solid technical profile: RS line is at a new high with a stable RS Rating of more than 90 in the past seven weeks. A/D Rating turned positive four weeks ago. Up/Down Volume ratio above 1 denotes strong buying interest.
- Institutional sponsorship increased 70% y/y to 723 funds as of June, denoting good accumulation.
