This is the pertinent question - it's always good to get dissenting views when we're bullish about a particular investment.
Goldman's target price and sell rating is based on NPV derived from forecast future prices. They predict 7% higher EBITDA this year compared to last (very much underdone IMO, given recent prices and discounts) and then for earnings to crater in the next two years with a decline in 62% FE to US$60 / tonne.
IMO the problem with this is two-fold
(1) it assumes no tendency of the market to dampen a long term fall in prices via supply contraction, and
(2) it ignores the likelihood that grade discounts will narrow further if prices fall.
As we've seen over the past 6 months, trying to predict prices and discounts is a mugs game anyway.
For me FMG is a buy up to the mid $5's. Not as much as it was in the $3's, and it's a shame that the market didn't allow more shares to be bought back near the bottom.
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Last
$20.60 |
Change
0.130(0.64%) |
Mkt cap ! $63.02B |
Open | High | Low | Value | Volume |
$20.75 | $20.75 | $20.54 | $23.52M | 1.137M |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
13 | 4448 | $20.58 |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
$20.60 | 1986 | 13 |
View Market Depth
No. | Vol. | Price($) |
---|---|---|
14 | 4449 | 20.580 |
8 | 3906 | 20.570 |
11 | 6980 | 20.560 |
12 | 5300 | 20.550 |
10 | 6417 | 20.540 |
Price($) | Vol. | No. |
---|---|---|
20.600 | 2777 | 14 |
20.610 | 3250 | 8 |
20.620 | 5979 | 7 |
20.630 | 7253 | 8 |
20.640 | 6499 | 7 |
Last trade - 10.38am 17/10/2024 (20 minute delay) ? |
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FMG (ASX) Chart |
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