FMG 2.02% $25.70 fortescue ltd

Value Investors' Sell Price

  1. 289 Posts.
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    TLDR: give your FMG sell price, and reasons why.

    I bought FMG at a little under $5 in early 2018. At that time, in those conditions, it appeared to be worth $7-8.

    The bumpy ride down through 2018 had me surprised, but not concerned, because the case for investing didn't seem to be broken.

    Smarter heads look on this business (an upstart miner competing with 3 established behemoths) with disdain, but to me it has at least some marks of being a high quality business:
    - founder with a large stake still involved
    - industry leader in production costs and its operations profitable under almost any scenario - even if the 2017/18 grade discounts were permanent. Being cheapest producer is a "moat" of sorts.
    - never had to raise fresh equity capital beyond the early years
    - rapidly deleveraging, with the twin positives of reduced interest payments (higher profitability year on year) and a much safer balance sheet.

    With the recent SP rise and now being around fair value, the question is at what price is it materially over-valued?

    My inclination is to sell at around $12 - looking through the next couple of years' elevated IO prices that's about as frothy as it should realistically get.

    Subtract $2-3 if the company starts misallocating serious cash on stuff like speculative lithium ventures or expanding in South America.

 
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Last
$25.70
Change
0.510(2.02%)
Mkt cap ! $79.12B
Open High Low Value Volume
$25.58 $25.78 $25.39 $142.8M 5.570M

Buyers (Bids)

No. Vol. Price($)
1 1 $25.63
 

Sellers (Offers)

Price($) Vol. No.
$25.75 3050 3
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Last trade - 16.10pm 29/03/2024 (20 minute delay) ?
Last
$25.73
  Change
0.510 ( 2.20 %)
Open High Low Volume
$25.57 $25.78 $25.39 738887
Last updated 15.59pm 29/03/2024 ?
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