Fund Manager Summary
The fund managers believe that the outlook for Perenti Ltd presents a promising opportunity for investors. In their opinion, the company is effectively executing its strategy by growing gradually, generating significant free cash flow, and maintaining disciplined capital allocation. This disciplined approach has allowed Perenti to thrive in a more rational contract mining market, with a focus on capital returns. With free cash flow guidance exceeding $150 million for the 2025 financial year, the fund managers note a substantial shift in industry dynamics. They acknowledge a 30% increase in share price since the beginning of the financial year, leading to their exit from the investment. Overall, consistency and operational delivery have reinforced their positive outlook on Perenti's performance.
Source: Trading View
Commentary From The Managers
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Maple-Brown Abbott
13 Oct 2025
$2.82
Summary
- Maple-Brown Abbott continues to hold a position in Perenti Ltd, a mining services business primarily through their Barminco underground contracting division.
- The business faced significant challenges in 2023 and 2024, highlighting the market's short-term focus.
- Concerns arose regarding the renewal of key contracts and potential cash flow delays.
- Despite market worries, Maple-Brown Abbott maintained confidence and increased their investment.
- Perenti was trading at a multiple of four to five times, considered very undervalued.
- The company successfully delivered contract renewals and cash flow exceeding market expectations.
- Perenti's earnings growth outlook has improved significantly, leading to a rerating to 13 times, which is closer to fair value.
- Future growth is expected to be driven by their drilling business, supported by capital raised by junior miners for exploration.
- This exploration activity over the next two to three years is anticipated to contribute to earnings upside for Perenti.
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Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Commentary From The Managers
Maple-Brown Abbott
13 Oct 2025
$2.82
- Maple-Brown Abbott continues to hold a position in Perenti Ltd, a mining services business primarily through their Barminco underground contracting division.
- The business faced significant challenges in 2023 and 2024, highlighting the market's short-term focus.
- Concerns arose regarding the renewal of key contracts and potential cash flow delays.
- Despite market worries, Maple-Brown Abbott maintained confidence and increased their investment.
- Perenti was trading at a multiple of four to five times, considered very undervalued.
- The company successfully delivered contract renewals and cash flow exceeding market expectations.
- Perenti's earnings growth outlook has improved significantly, leading to a rerating to 13 times, which is closer to fair value.
- Future growth is expected to be driven by their drilling business, supported by capital raised by junior miners for exploration.
- This exploration activity over the next two to three years is anticipated to contribute to earnings upside for Perenti.
Summary
Infinity Asset Management
31 Aug 2025
$2.32
- Infinity Asset Management continues to hold a positive outlook on Perenti Ltd (PRN).
- PRN had a strong month, advancing 34.5%.
- The company delivered record FY25 results, with revenue of $3.49bn and NPAT of $138m.
- Results were broadly in-line with consensus expectations, aided by pre-guided announcements in July.
- The market reacted positively to strong cash flow generation and outlook.
- PRN guided to free cash flow exceeding $160m for FY26.
- Revenue guidance for FY26 is in the range of $3.45bn to $3.65bn.
- This guidance reinforces confidence in its forward trajectory.
Summary
Forager Funds
30 June 2025
$1.62
- Forager Funds sold their investment in Perenti (PRN) after a significant share price increase.
- The company demonstrated consistent operational delivery and capital discipline.
- Perenti generated substantial free cash flow, with guidance exceeding $150 million for FY 2025.
- The mining services sector is experiencing a more rational market and increased focus on capital returns.
- Forager Funds noted a 30% run in share price since the start of the financial year as a reason for exiting.
Summary
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
ANALYST INSIGHT
Equity Research Analyst
"In a landscape often marred by volatility, Perenti Ltd appears to be a beacon of consistency and discipline, generating impressive free cash flow while others falter. As the market shifts, this disciplined approach may redefine success in mining services."
Last Updated: 13 Oct 2025
Query The Data
Frequently Asked Questions
Who is investing in Perenti Ltd (ASX:PRN)?
Fund managers including Forager Funds, Infinity Asset Management and Maple-Brown Abbott have invested in Perenti Ltd (ASX:PRN).
Why do fund managers invest in Perenti Ltd?
Fund managers invest in Perenti Ltd due to its consistent operational performance, significant free cash flow generation, and disciplined capital allocation. The company is capitalizing on a more rational market in contract mining, projecting over $150 million in free cash flow for the 2025 financial year, which distinguishes it in an industry typically characterized by capital consumption. These factors contribute to a favorable investment outlook.
What happened to Perenti Ltd (ASX:PRN)?
Fund managers are investing in Perenti Ltd due to its strong financial performance and positive outlook. The company reported record FY25 results with $3.49bn in revenue and $138m NPAT, alongside robust cash flow generation. Guidance for FY26 includes free cash flow exceeding $160m and revenues between $3.45bn and $3.65bn. Despite past market concerns regarding contract renewals, Perenti has successfully secured these contracts, leading to a favorable revaluation of its stock. The anticipated growth in its drilling business, fueled by increased capital from junior miners, further strengthens the investment case.