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Deterra Royalties Ltd
(Sydney:DRR)
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Rating:71Outperform
Price Target:
AU$5.00
▲(21.07% Upside)
Action:Reiterated
Date:08/19/26
The score is driven primarily by strong financial performance (high profitability and cash flow strength), supported by reasonable valuation and a high dividend yield. These positives are tempered by elevated leverage versus prior years and a mixed technical picture with neutral-to-weak momentum, while the latest earnings call was broadly constructive but included execution and leadership-timing risks.
Positive Factors
Strong cash generation
Consistently strong operating and free cash flow gives Deterra the capacity to fund dividends, reduce debt and pursue royalty investments without the heavy operating costs of mine ownership.
Negative Factors
Leverage has risen materially
The step-up in leverage reduces financial flexibility compared with Deterra's earlier capital structure, potentially limiting acquisition capacity and increasing sensitivity to weaker royalty cash flows.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Consistently strong operating and free cash flow gives Deterra the capacity to fund dividends, reduce debt and pursue royalty investments without the heavy operating costs of mine ownership.
Read all positive factors
Deterra Royalties Ltd (DRR) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$2.22B
Dividend Yield5.54%
Average Volume (3M)1.64M
Price to Earnings (P/E)13.5
Beta (1Y)1.25
Revenue Growth-5.40%
EPS Growth5.40%
CountryAU
Employees11
SectorBasic Materials
Sector Strength58
IndustryIndustrial Materials
Share Statistics
EPS (TTM)0.31
Shares Outstanding529,506,100
10 Day Avg. Volume1,852,328
30 Day Avg. Volume1,641,735
Financial Highlights & Ratios
PEG Ratio2.20
Price to Book (P/B)17.44
Price to Sales (P/S)10.26
P/FCF Ratio14.67
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$4.64Price Target Upside12.39% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
EPS Forecast (FY)0.27
Revenue Forecast (FY)AU$221.16M
Deterra Royalties Ltd Business Overview & Revenue Model
Company Description
Deterra Royalties Limited functions as an Australian royalty investment firm, specializing in the oversight and expansion of a diverse portfolio of royalty assets. These holdings cover a range of resources, including bulk commodities, base metals,...
How the Company Makes Money
DRR makes money by receiving royalty payments from operators of mining projects over which it holds royalty interests. The company’s primary revenue stream is royalty income tied to iron ore production/sales from the Mining Area C iron ore operati...
Deterra Royalties Ltd Earnings Call Summary
Earnings Call Date:Aug 17, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Feb 22, 2027
Earnings Call Sentiment Positive
The call conveyed a generally positive operating and financial performance: solid NPAT (AUD 164m), revenue and EBITDA growth (+6%), record MAC volumes (+9%) and strong balance sheet metrics (net debt AUD 132m, AUD 357m undrawn). Material progress on Thacker Pass and a low all-in cost of debt (3.8%) support future optionality. Downsides discussed include FX headwinds (A$ realized price down 2%), reduced one-off MAC capacity payments, an extended CEO search, and slower-than-expected M&A execution despite an active pipeline. On balance, the positive financial results, balance-sheet strength and project progress outweigh the operational and timing challenges highlighted.Positive Updates
Strong Full-Year NPAT
Reported NPAT of AUD 164 million for FY2026, driven by record MAC production/sales and profit from sale of non-core assets from the Trident acquisition.
Negative Updates
FX Headwind and Aussie Realized Price Decline
While U.S. dollar realized prices improved (USD 92 referenced), the stronger AUD offset gains and the Australian-dollar realized price was down 2% on FY25.
Read all updates
Q4-2026 Updates
Positive
Negative
Strong Full-Year NPAT
Reported NPAT of AUD 164 million for FY2026, driven by record MAC production/sales and profit from sale of non-core assets from the Trident acquisition.
Read all positive updates
Company Guidance
Management reiterated it will maintain a 75% payout ratio, paying a fully franked FY26 dividend of AUD 0.232 per share (H1 AUD 0.124 + H2 AUD 0.108) with an amended DRP that includes a discount, and said it would not revert to a 100% payout even if net debt approached zero; no timing was promised for the CEO appointment. They highlighted financial strength and deployment optionality: FY26 NPAT AUD 164m, revenue and underlying EBITDA both up 6%, macro royalties +7%, record sales 140 Mt dmt (+9%), AUD realized price down 2%, operating cost AUD 14.1m (including AUD 1m one‑off CEO cost), net debt AUD 132m (drawn AUD 143m) with AUD 357m undrawn capacity, average facility margin 1.3% and all‑in post‑tax cost of debt 3.8%; AUD 108m of asset‑sale proceeds were used to reduce debt (AUD 13m deferred due Aug‑2026) and the USD 82m disposals generated AUD 8.4m profit. On Thacker Pass (from Trident) they noted a net acquisition cost of ~USD 106m, Lithium Americas has drawn USD 1.2bn of a USD 2.2bn DOE loan (DOE taking 5% equity), GM contributed USD 945m, detailed engineering >95% complete, procurement >70% complete, updated mine life 85 years and expansion to 160,000 tpa, with first production targeted end‑calendar 2027.Deterra Royalties Ltd Financial Statement Overview
Summary
Income Statement
84
Very Positive
Balance Sheet
58
Neutral
Cash Flow
88
Very Positive
| Breakdown | Jun 2026 | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 242.40M | 263.43M | 240.51M | 229.26M | 265.15M |
| Gross Profit | 241.00M | 263.43M | 231.43M | 220.34M | 257.12M |
| EBITDA | 228.32M | 248.03M | 225.56M | 219.34M | 256.78M |
| Net Income | 164.21M | 155.69M | 154.89M | 152.46M | 178.46M |
Balance Sheet | |||||
| Total Assets | 363.75M | 502.37M | 101.29M | 115.19M | 153.49M |
| Cash, Cash Equivalents and Short-Term Investments | 10.51M | 24.39M | 31.06M | 29.49M | 27.46M |
| Total Debt | 143.29M | 295.40M | 497.00K | 186.00K | 248.00K |
| Total Liabilities | 221.10M | 377.71M | 20.94M | 23.05M | 34.87M |
| Stockholders Equity | 142.64M | 124.66M | 80.35M | 92.14M | 118.63M |
Cash Flow | |||||
| Free Cash Flow | 169.53M | 132.95M | 170.09M | 182.23M | 127.81M |
| Operating Cash Flow | 169.54M | 134.88M | 170.18M | 182.32M | 127.81M |
| Investing Cash Flow | 104.74M | -267.73M | -88.00K | -89.00K | -10.00K |
| Financing Cash Flow | -286.03M | 126.30M | -168.52M | -180.20M | -124.56M |
Deterra Royalties Ltd Technical Analysis
Positive
4.13
Price Trends
4.25
Negative
4.27
Negative
4.13
Positive
Market Momentum
-0.03
Positive
48.94
Neutral
24.10
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:DRR, the sentiment is Positive. The current price of 4.13 is below the 20-day moving average (MA) of 4.21, below the 50-day MA of 4.25, and above the 200-day MA of 4.13, indicating a neutral trend. The MACD of -0.03 indicates Positive momentum. The RSI at 48.94 is Neutral, neither overbought nor oversold. The STOCH value of 24.10 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:DRR.
Deterra Royalties Ltd Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
89 Outperform | AU$1.64B | 10.35 | 26.61% | 1.21% | 26.09% | 12.00% | |
71 Outperform | AU$2.22B | 13.52 | 116.70% | 5.54% | -5.40% | 5.40% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
55 Neutral | AU$3.60B | -145.86 | -0.86% | 5.44% | -3.18% | 88.11% | |
54 Neutral | AU$2.93B | -7.19 | -19.70% | 0.88% | -20.11% | -312.34% | |
50 Neutral | AU$1.65B | 84.85 | 2.27% | 12.57% | ― | ― | |
46 Neutral | AU$255.41M | -0.88 | -30.65% | ― | 6.78% | 32.51% |
* Basic Materials Sector Average
AU:DRR
Deterra Royalties Ltd
4.19
0.21
5.28%
AU:SYR
Syrah Resources
0.11
-0.13
-54.55%
AU:BCI
BCI Minerals Ltd
0.56
0.21
60.00%
AU:ILU
Iluka Resources Limited
6.80
0.50
7.89%
AU:MLX
Metals X Limited
1.85
1.21
190.55%
AU:NIC
Nickel Mines Ltd.
0.83
0.10
14.48%
Deterra Royalties Ltd Corporate Events
Aware Super exits substantial holder position in Deterra Royalties
Aug 18, 2026
Aware Super Pty Ltd, acting as trustee of Aware Super, has lodged a Form 605 notice indicating it has ceased to be a substantial holder in Deterra Royalties Ltd as of 13 August 2026. The filing notes no changes in association arrangements, implyin...
Deterra Royalties Declares Interim Dividend of AUD 0.108 per Share
Aug 17, 2026
Deterra Royalties Limited has declared a fully franked interim dividend of AUD 0.108 per ordinary share for the six‑month period ended 30 June 2026, with an ex‑dividend date of 25 August, a record date of 26 August and payment schedule...
Deterra Royalties Updates ASX-Aligned Corporate Governance Framework
Aug 17, 2026
Deterra Royalties Limited, an ASX-listed resources royalties company, manages a portfolio of royalty interests and relies on a robust governance structure to support its strategy and deliver returns to shareholders. The board oversees corporate go...
Deterra Royalties Highlights Data Limits and Market Risks in FY26 Results Release
Aug 17, 2026
Deterra Royalties Limited is an ASX-listed diversified resource royalty company that earns income from mining operations run by other parties, relying primarily on publicly disclosed information rather than direct asset access. It uses non-IFRS fi...
Deterra Royalties lifts profit, trims debt as core iron ore and lithium assets drive growth
Aug 17, 2026
Deterra Royalties reported a 6% rise in FY26 revenue to A$236.2 million and a 5% increase in NPAT to A$164.2 million, driven by record production and sales from its Mining Area C iron ore royalty despite slightly softer realised prices. Underlying...
Deterra Royalties Lifts Profit, Trims Dividend as Revenue Softens
Aug 17, 2026
Deterra Royalties reported FY26 revenue of $242.4 million, down 8 percent from the prior year, while net profit after tax rose 5 percent to $164.2 million, highlighting resilient profitability despite softer top-line performance.The board declared...
Deterra Royalties Sets Out 2026 Governance Timetable
Aug 14, 2026
Deterra Royalties Limited is an Australian-listed company that operates in the resources royalties sector, providing investors exposure to commodity-linked royalty streams rather than direct mining operations. The company focuses on managing and g...
State Street Group Ceases to Be Substantial Holder in Deterra Royalties
Jun 29, 2026
State Street Corporation, through its subsidiaries including State Street Global Advisors entities and State Street Bank and Trust Company, has lodged a notice that it has ceased to be a substantial holder in Deterra Royalties Limited as of 25 Jun...
State Street Group Ceases to Be Substantial Holder in Deterra Royalties
Jun 23, 2026
State Street Corporation and a group of its global asset management subsidiaries have lodged a notice that they have ceased to be substantial holders in Deterra Royalties Ltd. The filing, made under section 671B of the Corporations Act, records a ...
State Street Group Ceases to Be Substantial Holder in Deterra Royalties
Jun 17, 2026
State Street Corporation, through various global asset management and custody subsidiaries, has filed a notice that it has ceased to be a substantial shareholder in Deterra Royalties Ltd as of 15 June 2026. The change reflects a reduction in State...
State Street Entities Exit Substantial Holder Position in Deterra Royalties
Jun 10, 2026
State Street Corporation and several of its asset management subsidiaries, including State Street Global Advisors entities, have filed a notice that they have ceased to be substantial shareholders in Deterra Royalties Limited as of 8 June 2026. Th...
State Street Group exits substantial holding in Deterra Royalties
Jun 3, 2026
State Street Corporation, through various global asset management and trustee subsidiaries, has ceased to be a substantial shareholder in Deterra Royalties Ltd as of 1 June 2026. The notice, lodged under Australia’s Corporations Act, records...
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.