I think the current price is fair, the market doesn't value companies on the current six-monthly metrics. The market knows this is an anomalous result due to the supply problems in Brazil (double whammy of dams and Covid) and if you value FMG on long-term IO price assumptions it's not worth $30 and possibly not even $17.99. Plus, as a company that still only produces a single commodity they are always going to trade at a risk discount compared to a diversified miner.
It's only two or three years ago that FMG was trading in the 3s. I certainly wouldn't be paying $30 for FMG knowing that it's inevitable that the IO market will eventually equilibrate and likely overcorrect into oversupply. FMG is in a much stronger position now than it was back then, with almost zero net debt and some higher-grade product to lessen the vulnerability to the low-grade discount that was a big issue a few years ago, but if the 62% CFR price drops back to the levels it was then (around $60) it's still going to hurt.
So I'm just going to enjoy the yield while it lasts. My average price for FMG is $4.70 so I'm at a 53% gross dividend yield.
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Last
$22.36 |
Change
-0.230(1.02%) |
Mkt cap ! $68.84B |
Open | High | Low | Value | Volume |
$22.46 | $22.63 | $22.34 | $108.3M | 4.768M |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
2 | 1690 | $22.35 |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
$22.37 | 13926 | 2 |
View Market Depth
No. | Vol. | Price($) |
---|---|---|
2 | 1690 | 22.350 |
5 | 7065 | 22.340 |
4 | 18200 | 22.330 |
3 | 5747 | 22.320 |
4 | 17409 | 22.310 |
Price($) | Vol. | No. |
---|---|---|
22.380 | 100 | 1 |
22.390 | 130 | 2 |
22.400 | 600 | 2 |
22.410 | 400 | 2 |
22.420 | 200 | 1 |
Last trade - 16.10pm 17/07/2024 (20 minute delay) ? |
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FMG (ASX) Chart |