Out for some extra passive income and looking for a high-yielding S&P/ASX 200 Index (ASX: XJO) dividend stock to add to your portfolio?
Then you may wish to run your slide rule over Stanmore Resources Ltd (ASX: SMR).
That's according to Seneca Financial Solutions' Arthur Garipoli, who says the Aussie coal miner's recent share price declines present investors with a "discounted valuation" (courtesy of The Bull).
ASX 200 dividend stock trading at a discount
"This coal producer recently reported a strong result in the 2024 December quarter despite weather impacts and a planned outage," said Garipoli, who has a buy recommendation on the ASX 200 dividend stock.
According to Garipoli:
Full year saleable production of 13.8 million tonnes for full year 2024 exceeded the upper end of the guidance range. Given a two-year capital expenditure campaign is nearing completion, Stanmore is well-positioned to lift earnings and cash flow.
Despite those strong results, Stanmore shares have faced some stiff headwinds over the last 12 months. Up 1.4% in late afternoon trade today at $2.54 a share, the Stanmore Resources share price is down 25% since this time last year.
However, this could offer an attractive entry point.
"The recent share price decline can be attributed to a lower coal price. In our view, it provides investors with an opportunity to buy SMR at a discounted valuation, while benefiting from a historical fully franked dividend yield above 7%," Garipoli said.
Over the past 12 months, the ASX 200 dividend stock has paid out two fully franked dividends totalling 19.5 cents a share. At the current share price, that sees Stanmore Resources trading on a fully franked trailing dividend yield of 7.7%.
What's the latest from Stanmore Resources?
The last price-sensitive news from Stanmore was the miner's December quarter results, released on 28 January, which Garipoli referred to above.
Commenting on those results at the time, Stanmore Resources CEO Marcelo Matos said:
Stanmore concluded a strong 2024 with the saleable production from our three core operating assets exceeding the consolidated guidance range, offsetting lower production from the decision to close Millennium earlier in the year…
Overall, we ended the quarter with healthy levels of product and ROM stockpiles across the portfolio, which should also help de-risk and support 1Q 2025 sales performance
On the balance sheet, the ASX 200 dividend stock ended 2024 with consolidated cash of US$289 million and liquidity of more than US$500 million.
Management noted this provides Stanmore with "strong financial support" to work through all phases of the commodity cycle going forward.
