Very interesting read from the HC front page on FMG:
https://hotcopper.com.au/posts/29119994/single
I’ve always liked FMG. Have met Andrew Forrest and regard him with great admiration as a man of purpose and integrity. Some may differ in opinion, however if you take a look at his achievements outside of FMG, you have to admit that he is a marked contrast to a number of other billionaire types (in faith, altruism, philanthropy, assisting refugees and the indigenous etc).
Anyway.. For me, a key marker of a good company is its ability to drive costs down so that profitability is maximized
over a long period of time (ie regardless of market cycles). FMG has proved this conclusively: as you know, it’s the lowest-cost (per wmt) producer of shipped ore, and is continually improving efficiencies - ie driverless trucks.
I’m very bullish on renewables and new technologies and resources that may one day completely replace our need for IO. However that’s a long way away. It will take a very long time to unwind from our dependence on iron ore (for smelting and other large scale industrial applications for example) and Fortescue is well positioned to be a low-cost, high-grade front-runner as this all evolves.
In my book, FMG represents extremely good value at this price point, and barring a
major trade downturn with China, will be a star performer through 2018.