market is underestimating fmg, page-2

So many variables at play

- Current volume may exceed 160.0mt, I read potential of 172.0mt pa
-  Discount applied against 62.0 fe
- Stripping ratios ( i sought of understand) "could significantly reduce costs in the short run"
- Dollar value of costs cut in employment and contractors
- Effect of AUD
- Amount of savings in reduced diesel costs (spend in 2014 > $800.0m)
- Reduced shipping costs
- Reduction in costs due to better port facilities
- Reduction in costs ($30.0m) and efficiency gains with new scheduling and production software ("world class")
- Savings achieved using autonomous truck fleet

UBS estimates that based on the recent drop in freight costs and the weaker Australian dollar, Fortescue is now cash break even at a benchmark price of $58, keeping it in the black compared with Monday's price of $63.30.


Does the UBS cash break even price of of $58.0mt take into account all of the above??? The $51.0 cost per mt should also be on the high side, and FMG may really surprise on this.

All hope is not yet lost, I was toying buying more today for a short term trade at $1.95 but fear set in, could of sold at around $2.03-$2.05 for a decent profit, too risky, Thursdays report will be the game changer.

I am also expecting a major announcement soon similar to their rabbit out of a box in 2012 when they manged to refinance at better rates with no loan covenants. Management seem to come good in difficult times with FMG.