Iron ore price, page-36149

Hi MegaA. I saw your comment that "it has only been the last 2 years that the fmg dividends have been attractive ".
I would like to out a couple of points to you.
1. FMG has changed fundamentally in the last couple of years. It is now debt free and is now a rock solid blue chip with a rock solid balance sheet plus a low cost structure. In the past FMG needed its cash to help pay down its huge debt but no longer. As a debt free company in the last couple of years it is free to pay out high dividends.
2. At the long term iron ore price of USD98 to 110 FMG is highly profitable and will pay attractive dividends year in year out. At that IO price and an 80% payout ratio FMG will pay out franked dividends of $2.20 per annum which is more than 10% franked at the current share price.
Another way of saying this is that the FMG share price is too low. For a 5% dividend yield at the long term average IO price the share price would be over $40.