DRDGOLD (DRD.JO)

Materials · JSE · South Africa

R32.58-20.69% today

Fundamentals

Market capR30.24B

P/E ratio13.5

Dividend yield2.87%

Revenue growth (YoY)+32.9%

Profit margin35.1%

Return on equity34.7%

52-week rangeR23.80 to R65.00

Valuation and ratings

DCF fair valueR76.69

Upside to fair value+135.4%

Analyst target (mean)R55.00

Analyst rangeR40.00 to R80.00

Analysts covering3

Consensus viewhold

Moat score89/100

Overall rating89/100, Strong Buy

DRDGOLD trades at R32.58, which is 135% below the R76.69 our discounted cash flow model puts on the business. On that measure alone it screens as undervalued, though a DCF is an argument rather than a measurement, and the market is frequently right about why something is cheap.

Our moat model scores it 89 out of 100, which is a wide moat. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.

It changes hands at 13.5 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.

About DRDGOLD

DRDGOLD Limited, a gold mining company, engages in the extraction of gold from the retreatment of surface mine tailings in South Africa. It sells gold and silver bullion. It is involved in provision care and maintenance services; produces renewable power; employee home loans; and operation of training center. The company was formerly known as Durban Roodepoort Deep Limited and changed its name to DRDGOLD Limited in 2004. The company was incorporated in 1895 and is headquartered in Johannesburg, South Africa. DRDGOLD Limited is a subsidiary of Sibanye Gold Limited.

Industry: GoldEmployees: 881HQ: South Africa

DRD.JO passes 6 of our 30 screens today

Each screen prints the exact criteria it used, and the circumstances in which it is wrong.

Undervalued on cash flow

Companies trading at least 25% below what our discounted cash flow model says the future cash is worth today.

Quality at a fair price

Good businesses, not cheap ones. A wide moat and a strong rating, at a multiple that has not run away.

Wide moat compounders

Businesses with a structural reason competitors cannot take their profits away. The rarest and most valuable thing in investing.

Growing dividend payers

A modest yield attached to a growing business beats a large yield attached to a shrinking one, every time, over any horizon that matters.

High return on equity, low debt

A high ROE is easy to fake with borrowing. This screen demands the return without the leverage, which is a much shorter list.

Fortress balance sheets

Companies that owe almost nothing. They will survive things that kill their competitors, and they can buy the wreckage afterwards.

Common questions

Is DRDGOLD (DRD.JO) undervalued?

Against our discounted cash flow estimate of R76.69, DRD.JO at R32.58 is 135% below fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.

What is DRD.JO's P/E ratio?

DRD.JO trades at 13.5 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.

The full research page for DRD.JO, with financial statements, ownership detail, peer comparison and alerts, is free inside the app.

Open DRD.JO in the app Free guides and screens

Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.