FMG 3.09% $17.34 fortescue ltd

I think the current price is fair, the market doesn't value...

  1. 6,308 Posts.
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    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. eek.png
 
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Last
$17.34
Change
0.520(3.09%)
Mkt cap ! $53.38B
Open High Low Value Volume
$17.31 $17.51 $17.00 $309.6M 17.18M

Buyers (Bids)

No. Vol. Price($)
1 300 $17.33
 

Sellers (Offers)

Price($) Vol. No.
$17.35 28897 5
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Last trade - 16.10pm 16/08/2024 (20 minute delay) ?
FMG (ASX) Chart
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