The performance at Mining Area C was better than expected in the June quarter. This is principally based on a strong ramp up at South Flank.
The company will continue to offer organic volume growth and product quality improvement yet the broker notes little commentary on M&A opportunities.
Credit Suisse emphasises the share price has been materially lagging the Australian dollar iron ore price but acknowledges Deterra Royalties is probably less competitive on dividend yields against a backdrop where iron ore prices remain above US$200/t.
Outperform rating and $5 target maintained.
Target price is $5.00.Current Price is $4.52. Difference: $0.48 – (brackets indicate current price is over target). If DRR meets the Credit Suisse target it will return approximately 10% (excluding dividends, fees and charges – negative figures indicate an expected loss).