ASX materials stock Coronado Global Resources Inc (ASX: CRN) is in focus today after its share price jumped 10.5% higher on Tuesday.
It has been a clear earnings season winner as investors reacted positively to its FY25 full-year result.
This marked a turnaround for the ASX materials stock. Even with yesterday's big gain, its share price is down more than 44% over the last year.
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What did the company report?
Coronado Resources is a leading international producer of high-quality metallurgical coal, an essential element in the production of steel.
The company operates in two of the largest and most productive metallurgical coal basins in the world, the Bowen Basin in Queensland, Australia and the central Appalachian region of the US.
Yesterday, it released full financial year results for 2025.
This included:
- Revenue of US$1.95 billion, down from US$2.51 billion in 2024
- Adjusted EBITDA loss of US$144.2 million. After a positive US$115.1 million in FY24
- Total sales volume of 15.6 million tonnes, compared with 15.8 million tonnes in 2024.
As The Motley Fool's Aaron Teboneras reported yesterday, it was a somewhat surprising the positive reaction after a tough year for the coal miner.
What is Bell Potter's view?
Following yesterday's result, the team at Bell Potter released updated guidance on this ASX materials stock.
Commenting on yesterday's result, the broker said the reported underlying EBITDA loss was slightly better than Bell Potter's estimate.
However, the statutory net loss after tax was US$432 million, worse than expected due to higher finance costs. As expected, no dividend was declared.
The broker also noted that although Coronado Resources is focused on reducing debt. It has flagged a potential ~2Mtpa Mammoth Phase 2 underground project, with an estimated capital cost of around US$150 million.
This project depends on market conditions and Board approval.
CRN's capital allocation framework outlines growth investment only when its available cash liquidity is above US$400m. Under our operating and coal price outlook, CRN will not materially deleverage over the forecast period.
Price target decreases
Based on this guidance, earnings per share forecasts have been reduced by 6% for CY26, 21% for CY27, and CY28 is now expected to record a small loss (previously a profit was forecast).
Bell Potter has maintained its speculative hold recommendation on this ASX materials stock.
It lowered its price target to $0.38 (previously $0.43).
From yesterday's closing price of $0.32, this revised target indicates a potential upside of approximately 20% for this ASX materials stock.
We maintain our Speculative Hold recommendation, recognising balance sheet risks. In the near-term, operational performance should lift with the ramp-up of Mammoth underground and the Buchanan expansion projects, supporting production volumes and lower unit costs.
