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Highlights
- Mineral Resources shares have fallen nearly 50% in 2024, hit by commodity price weakness and a tax scandal.
- Brokers, including Bell Potter, predict a strong rebound for the miner, with a potential 65% upside.
- Positive catalysts for the stock include the ramp-up of the Onslow Iron Project and a potential tightening lithium market.
Mineral Resources Ltd (ASX:MIN) has had a tough year in 2024. Shares in the mining and mining services company have plunged by nearly 50% since the start of the year. The declines have been triggered by a combination of weak commodity prices and a tax scandal involving the company’s founder and CEO, Chris Ellison. As the year draws to a close, investors are wondering: will 2025 be better for Mineral Resources? Let's explore the outlook for the miner in the coming year.
Mineral Resources Share Price Outlook for 2025
After a year of steep losses, it may not come as a surprise that many analysts believe the only way for Mineral Resources' shares is up. One such analyst is Bell Potter, which has placed a buy rating on the stock and set a price target of $61.00. This is a significant jump from the current share price of $36.86, implying a potential upside of 65% for investors over the next 12 months.
Bell Potter’s optimism stems from several key factors that could drive growth for the company. The broker’s note highlights three main catalysts:
- Onslow Iron Project Ramp-Up: Mineral Resources is set to ramp up its Onslow Iron Project in 2025, which could significantly boost production and revenue for the company.
- Deleveraging and Balance Sheet Strengthening: The increased cash flow from Onslow is expected to help reduce the company’s debt, strengthening its balance sheet and allowing for further capital release.
- New Leadership: With changes in leadership, Mineral Resources is poised to inherit a stronger governance structure, a solid set of assets, and greater growth potential moving forward.
What Else Could Impact Mineral Resources Shares?
While the company’s outlook is bolstered by these internal factors, the performance of Mineral Resources’ shares could also be heavily influenced by external market dynamics. One of the key factors to watch is the price of lithium, as the company has substantial exposure to the lithium market. Given the growing global demand for lithium, especially for electric vehicle batteries, fluctuations in lithium prices could have a significant impact on the company’s revenue and profits.
In this regard, Bell Potter is optimistic about the lithium market. The broker recently issued a positive outlook for the lithium sector, forecasting that the market will tighten in 2025 and eventually reach a deficit by 2026. If these predictions prove accurate, Mineral Resources could stand to benefit from higher lithium prices, adding another potential growth driver for the company.
Final Thoughts on Mineral Resources
Although 2024 has been a challenging year for Mineral Resources, the company’s prospects for 2025 look brighter. With positive catalysts like the ramp-up of the Onslow Iron Project, a more robust balance sheet, and a potential tightening of the lithium market, the company could be on track for a strong rebound. Investors looking for a potential turnaround story may find Mineral Resources a compelling option, especially given the substantial upside forecasted by analysts. However, as with any investment, risks remain, and investors should keep an eye on external market factors and the company’s execution on its growth plans.
