Last year I was fortunate enough to pick this up at the low of around 61c and made good profit although admittedly sold a little earlier.
I couldn't believe my luck when the stock once again reached this level but now this time the iron ore price was around $50 higher! I picked some up at 58c and again at 50c and 46c. Can't claim I picked the low this time around but I have the feeling it is close. This is not based on the charts but on the fundamentals.
We are at 47c with around 27c a share in cash. The market cap is $500m and cash is at $280m. Admittedly the cash may have been depleted by the recently paid dividend, however 3 months of cash flow would have accrued which I think should see our cash balance sitting at around $300m.
So we are a company with an enterprise value of around $200m. We made $37m in net profit in the first half selling our 4 or so million tonnes at $94. Given that the iron price is holding above $135 I think we can conservatively say the average achieved price will be at least $120 or $26 more than last half. Our margin at a sale price of $94 was $15. At $120 it is around $41. A $41 margin on 4m tonnes should see operating cash flow of around $160m. Less tax and expenses we should have around $100m in NPAT. For the year our net profit will be around $140m. Not bad for a company with an enterprise value of $200m. An EV/E multiple of 1.5x is about as low as I have seen for any company.
The share price is collapsing based on a anticipated $90 iron ore price from 2015 (Thank you Rio and Goldman Sachs). What i see is a $500m company that is on track to have $500m in cash this time next year and hopefully around $400m in cash within the next 4 months.
I am not calling a bottom but I am calling MGX extremely good value at these levels. This is baby with the bath water stuff.
Go MGX! Good luck guys!
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Last
28.0¢ |
Change
0.005(1.82%) |
Mkt cap ! $341.1M |
Open | High | Low | Value | Volume |
28.0¢ | 29.0¢ | 28.0¢ | $224.7K | 796.8K |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
4 | 132300 | 28.0¢ |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
28.5¢ | 103176 | 2 |
View Market Depth
No. | Vol. | Price($) |
---|---|---|
3 | 96586 | 0.280 |
6 | 197884 | 0.275 |
5 | 107110 | 0.270 |
5 | 265552 | 0.265 |
5 | 125750 | 0.260 |
Price($) | Vol. | No. |
---|---|---|
0.285 | 103176 | 2 |
0.290 | 131879 | 6 |
0.295 | 210000 | 2 |
0.300 | 128528 | 6 |
0.305 | 86410 | 5 |
Last trade - 16.10pm 11/09/2024 (20 minute delay) ? |
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