The market will then look to the future and starting speculating...

The market will then look to the future and starting speculating about 100mtpa production. Let's do some really basic analysis here of what is a really basic business. Let's assume in fy10 that FMG produces 100mt at an average margin of $50t (conservative). That's EBIT of $5,000,000,000. FMG's pays some corporate tax (30% conservative) and that leaves NPAT around $3,500,000,000. FMG has 2,802,393,400 shares on issue, of which an amazing 70% are owned by just 5 parties and the top 20 shareholders own 92% (great idea to short that register structure). EPS works out $1.24 a share on that scenario and I think the market will pay an absolute minimum of 10x for that earnings stream. That generates a price target of $12.40 per FMG share.

(great idea to short that register structure).(great idea to short that register structure).(great idea to short that register structure).