Is the beaten down Mineral Resources share price a bargain buy now?

Let's see what Bell Potter is saying about the miner after Monday's selloff.

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The Mineral Resources Ltd (ASX: MIN) share price had a terrible start to the week on Monday.

The mining and mining services company's shares lost almost 10% of their value to finish at $36.70.

Why did the Mineral Resources share price crash?

Investors were quick to hit the sell button yesterday after the company completed its investigation into its founder and CEO, Chris Ellison.

This investigation culminated in Ellison agreeing to step down as the company's leader within the next 18 months.

Ellison was also hit with board-imposed financial penalties of $8.8 million, and loss of remuneration of up to $9.6 million.

These actions were in response to a range of issues and shortcomings that demanded a strong and comprehensive governance response. This includes the outgoing CEO's interest in a British Virgin Islands company, Far East Equipment Holdings Limited (FEEHL), which bought and sold mining equipment.

In addition, the investigation found that Mr Ellison, on occasions, used company resources for his personal benefit. This includes "directing Company employees to work on his boat and properties; directing a Company employee to manage his personal finances; and using the Company to procure goods and services for his private use."

But the big question now is whether the Mineral Resources share price is good value or not? Let's see what one leading broker is saying.

Is this a buying opportunity?

Bell Potter remains positive on the company and thinks investors should be buying the dip. Though, it warned that there could be some volatility in the Mineral Resources share price in the medium term. It said:

There could be ongoing volatility in MIN's share price for some time as: (1) ongoing investigations could confirm further allegations, (2) ongoing investigations could implicate other executives, (3) the leadership transition is relatively long dated, and, (4) at least some investors will be unhappy at the loss of Mr Ellison's leadership, and, (5) Mr Ellison is MIN's largest shareholder, and there could be speculation about his continued ownership.

Nevertheless, in response to the news, the broker has retained its buy rating and $61.50 price target. Based on its current share price, this implies potential upside of 68% for investors over the next 12 months. It concludes:

We continue to base our investment view on the fundamentals of MIN's business. Looking forward 12-months, we think the proposed changes will be complete, or near complete, and MIN will continue to be an attractive investment, and accordingly we maintain our buy recommendation.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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