I'm betting the same as you but with considerably less investe in this stock than you have.
Wondering why aren't you investing between the other iron ore stocks such as MGX and BCI?
I don't think 3 years is a long time to wait to quadruple your money. FMG is probably going to pay a tax advantaged dividend better than I could get with bank interest over the next three years, plus a decent capital gain, that's good enough for me.
I would rather a bumpy ride that nets me over a 50% per year averaged return over the next 3 years, than a steady 3%
Wondering why aren't you investing between the other iron ore stocks such as MGX and BCI?
Simple, those companies don't compare to FMG.
Look at FMG's Infrastructure, their system of ports, rail lines, 4 operating mines, exploration acreage, discovered reserves for future projects etc. the other companies don't compare.
Iron ore Inventories at chinese ports were down by another 1.04% this week.
Less than 20 days supply, and a level not seen for almost 2 years.
Simple, those companies don't compare to FMG.
Look at FMG's Infrastructure, their system of ports, rail lines, 4 operating mines, exploration acreage, discovered reserves for future projects etc. the other companies don't compare.
Take a look at this video, they assets beat anything those bci has, in fact bci actually pay FMG to ship their ore on their rail and port infrastructure.
[video]https://m.youtube.com/watch?v=PRw3m_EBknk[/video]
You wouldn't expect them to have FMG's infrastructure given the size of their company. For a co like BCI you'd expect once they get a proper footing, reduce their expenses and become profitable they would surge more than FMG.
Can i ask how much % of your total portfolio you have in FMG? Sounds like this is your LT punt of the decade
What do you think about this report that the reduction in their cost base is unsustainable? I also note that this analyst is one of many that seem to refuse to believe that their cost base is at $39 and rates it much higher at $44. He also goes on to state he is only expecting $300m in free cash flow this financial year, which would suggest that he believes that fmg will only clear approximately $2 per tonne this financial year.
http://www.afr.com/business/mining/...eyond-two-years-analysts-20150702-gi3mgx.html
Fortescue says it can reduce its cost of production, known as cash or C1 costs, to $US18 a tonne this fiscal year – from $US26 a tonne last half – and all-in-costs to $US31 a tonne, which includes sustaining capital expenditure of just $US2 a tonne.
"We think this is sustainable only in the short to medium term and expect the average group strip ratio to increase … this will have a significant impact on FMG's all-in costs and product quality in our view," Mr Young said.
The miner has said its break-even point – the price at which it is not making or losing cash – is tracking at $US39 a tonne, from $US60 a tonne late last year, and the group is aiming to reduce that further.
Fortescue is on track to achieve its production cost targets, he says, but takes a different view on its break-even point – estimating it at about $US44 a tonne right now.
"The question is how long can they do this for, and what potential outcome does it incur in terms of curtailing or reducing the reserve life?" Mr Lawcock said.
"They've done a commendable job [in reducing costs], but that break-even number in the low $US40s, or $US39 if you take their number, will only be sustainable for the next one to two years. It will then start to move up gradually, because there will be an inability to maintain sustaining capital at $US2 a tonne."
He tips costs will creep back up by at least $US5 to $US6 a tonne from about 2020.
Mr Young is tipping Fortescue will generate about $US300 million in free cash flow in the current financial year, and for it to take three to four years to reduce gearing to a comfortable level.
$1.61 low to $1.79 bounce today. Can't believe this crap. Sold yesty for $1.73
$1.61 low to $1.79 bounce today. Can't believe this crap. Sold yesty for $1.73
$1.61 low to $1.79 bounce today. Can't believe this crap. Sold yesty for $1.73
iron ore futures in China shot nearly 6 per cent higher in early trade, signalling the sell off in spot prices may take a break tonight.
I thought they scrapped the contract pricing a few years ago
when Iron ore price was roaring up BHP and the like got greedy and decided they want to play spot price instead so most miners now sell at spot price, it now back fire
that is my recollection I could be wrong.
What is the underlying story here? Has fortescue always had forward contracts for its ore? Does this in some way suggest that fortescue has lost some level of corporate support from china?
Furthermore, and rather shocking given the excesses that look apparent in the iron ore market, we learned that, for the first time ever, Fortescue Metals Group is offering iron ore on a spot basis, or, for all intents and purposes, “dumping” iron ore into China.
FMG under $1.80 - has always been the way to go....screaming buy i would think.
Anyone know what is holding up Fortescue's Quarterly Report?
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