MichaelD
Not fooled by randomness
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ROFL!
That's a classic way to put this truism. Straight to the pool room!
(to make it relevant to FMG...I see it's back down below $2.50 again. That didn't take long.)
FMG - Fortescue Ltd
- Thread starter GreatPig
- Start date
ROFL!
That's a classic way to put this truism. Straight to the pool room!
(to make it relevant to FMG...I see it's back down below $2.50 again. That didn't take long.)
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Good morning folks
Another day for the Mohicans
It reminds me of the saying in world war " The Alliance successfully retreated" (Of course I was not born that time and read in the book
.
Similarly FMG has done smart marketing where cancelling/ changing the FOB shipping schedules (with no demand).
Quoted in the report lodged by FMG
" Fortescue Metals Group (“ASX:FMG” “Fortescue”) advises that consistent with the continued prudent management of its business and in reflection of changed operating conditions, it has exercised suspension of all of its long term CFR shipping Contracts of Affreightment and Consecutive Voyage Contracts on the basis of unforeseen circumstances."
" The changed arrangements as a result of these suspensions, should not affect Fortescue’s marketing program in regards to volumes of product shipped, just the split between CFR and FOB sales terms" ( Miner added : So does it mean that we will continually getting marketing speeches. Andrew and his team will keep on discussing with 16 Chinese Mills )
"The changed arrangements are in direct response to market conditions demanding greater FOB sales." (Miner added : So does it mean the market is dictating to disclose the true story with FMG as well in line with world trend - a realistically level playing field now)
Disclaimer : Currently still holding FMG bought at $7
Another day for the Mohicans
It reminds me of the saying in world war " The Alliance successfully retreated" (Of course I was not born that time and read in the book
.Similarly FMG has done smart marketing where cancelling/ changing the FOB shipping schedules (with no demand
).Quoted in the report lodged by FMG
" Fortescue Metals Group (“ASX:FMG” “Fortescue”) advises that consistent with the continued prudent management of its business and in reflection of changed operating conditions, it has exercised suspension of all of its long term CFR shipping Contracts of Affreightment and Consecutive Voyage Contracts on the basis of unforeseen circumstances."
" The changed arrangements as a result of these suspensions, should not affect Fortescue’s marketing program in regards to volumes of product shipped, just the split between CFR and FOB sales terms" ( Miner added : So does it mean that we will continually getting marketing speeches. Andrew and his team will keep on discussing with 16 Chinese Mills )
"The changed arrangements are in direct response to market conditions demanding greater FOB sales." (Miner added : So does it mean the market is dictating to disclose the true story with FMG as well in line with world trend - a realistically level playing field now)
Disclaimer : Currently still holding FMG bought at $7
Sean K
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i am starting to accumulate this now
looks like its heading higher
no chance of it going under $2 now
Eggs primed, pies in reserve.
Good luck agro.
On the other hand, long term (2-7 years), you could have picked a winner.
Trembling Hand
Can be found on the bid
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come on guys, im sure most people here would like to see the stock go up, i dont currently own any but always keep a watchful eye.. i think the "i told you so thread" is a little bit harsh.. i dont REALLY like to see or hear about people losing money. agreed perhaps they should be more careful or maybe im just a big softie. my advice after watching FMG everyday for about 2 years.. the way AT THE MOMENT id say to make money on it..... find a dirt cheap entry point.. buy during one of those rallys that occur every now and then try and get in either the day before.. or (more likely) at 10:01am on the day... when you can see it going nuts in the pre open.. and then sell it out 1-2 weeks later when you have made 30-40%.. wait for it to go down again then repeat.. and for those who say "you cant time the market"..... i ask whats your average price on FMG (probable responses 7,8 dollars or higher....(im not saying theres anything wrong with that.. but dimiss what im saying at your own peril) surely on THIS STOCK ... you would have been better with this stratergy if stop loss was used.
i dont expect to cry myself to sleep because i sold it for 2.50 or 2.90 and then it went to $13 any time soon
i dont expect to cry myself to sleep because i sold it for 2.50 or 2.90 and then it went to $13 any time soon
I would agree I would love to see it go up. partly because i own some but I think it will bounce back to resistance around 2.93 $3. then keep bouncing between support of 2.20 and $3 what does everyone think. Once it takes off past the $3 it won't be no Titanic but nice Bahama Cruise that's bringing home the bacon.
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I was actually thinking about it today on the drive home....with the closing price.. if it does go below $2.00 and or below 1.50 it could be a little bit scary because its been there before but this time would we see resistance broken?? could a new low cause a capitulation? I think bargin prices offered for a "2nd time" might not appear such a bargin to some investors. I AM looking to buy back in just a bit concered if the price is allready low (say just over $1.00) it wouldnt take much of a move for you to lose a large %. Stop loss could be hit quite quickly. although the possible gains are big.
I guess im some what stating the obvious.
FYI - currently not holding FMG.
I guess im some what stating the obvious.
FYI - currently not holding FMG.
China Valin Signs Iron Ore Deal With Fortescue Metals -Xinhua
Monday, Dec 08, 2008
Australias third-largest iron ore supplier, Fortescue Metals Group Ltd. (FMG.AU), has inked a deal with Chinese steelmaker Hunan Valin Steel Co. (000932.SZ) to develop iron ore mines and to process ores in Changsha, Hunan province, Xinhua News Agency reported Thursday.
Xinhua didnt specify the expected volume or the value of the deal. Valin, which has limited iron ore supplies, hopes to get stable and competitively priced ores out of the deal, the state-run news agency said.
Fortescue Chief Executive Officer Andrew Forrest was quoted by SinoCast China Business Daily News last week as saying the deal would allow Valin to get a stable iron ore supply over the long term, and that Fortescue would get strong support in developing low-tenor iron mines from a couple of higher education institutions in Hunan province - he named Central South University.
The Xinhua report Thursday said Hunans provincial government supported the deal.
Source: http://www.yourindustrynews.com/chi...deal+with+fortescue+metals+-xinhua_17731.html
could be interesting come tomorrow
Monday, Dec 08, 2008
Australias third-largest iron ore supplier, Fortescue Metals Group Ltd. (FMG.AU), has inked a deal with Chinese steelmaker Hunan Valin Steel Co. (000932.SZ) to develop iron ore mines and to process ores in Changsha, Hunan province, Xinhua News Agency reported Thursday.
Xinhua didnt specify the expected volume or the value of the deal. Valin, which has limited iron ore supplies, hopes to get stable and competitively priced ores out of the deal, the state-run news agency said.
Fortescue Chief Executive Officer Andrew Forrest was quoted by SinoCast China Business Daily News last week as saying the deal would allow Valin to get a stable iron ore supply over the long term, and that Fortescue would get strong support in developing low-tenor iron mines from a couple of higher education institutions in Hunan province - he named Central South University.
The Xinhua report Thursday said Hunans provincial government supported the deal.
Source: http://www.yourindustrynews.com/chi...deal+with+fortescue+metals+-xinhua_17731.html
could be interesting come tomorrow
Forrest mentions BHP but coyly
Alex Wilson | December 10, 2008
Article from: Dow Jones Newswires
FORTESCUE Metals Group chief executive Andrew Forrest says the miner's iron-ore assets would be attractive to BHP Billiton.
But the best option for the company is to stick to its growth plans.
Since BHP walked away from its $135 billion bid for Rio Tinto, there has been speculation it could turn its sights on Fortescue.
Mr Forrest said his company's assets were likely to be of interest to the mining giant.
Fortescue has a suite of assets that on the global commodity scene would be almost impossible to replace, he said.
"We would be very attractive to BHP and to other companies, but I think we are most attractive to our current shareholders," Mr Forrest said.
He said that, although he would have to keep an open mind to any offer, Fortescue shareholders would be best served by the company pursuing its growth plans at its operations in the Pilbara region of Western Australia.
"I am paid to never say never, but I can say that the value that we see in front of the company is very, very strong," he said.
"The option on the growth of Asia, which Fortescue shareholders have, is enormous and unless BHP or anyone else can show them a shorter path to that growth, then we will stick to the current plan."
LINK:
http://www.theaustralian.news.com.au/business/story/0,28124,24777156-36418,00.html
Would be interesting if BHP make a comment in relation to the possible t/over
Alex Wilson | December 10, 2008
Article from: Dow Jones Newswires
FORTESCUE Metals Group chief executive Andrew Forrest says the miner's iron-ore assets would be attractive to BHP Billiton.
But the best option for the company is to stick to its growth plans.
Since BHP walked away from its $135 billion bid for Rio Tinto, there has been speculation it could turn its sights on Fortescue.
Mr Forrest said his company's assets were likely to be of interest to the mining giant.
Fortescue has a suite of assets that on the global commodity scene would be almost impossible to replace, he said.
"We would be very attractive to BHP and to other companies, but I think we are most attractive to our current shareholders," Mr Forrest said.
He said that, although he would have to keep an open mind to any offer, Fortescue shareholders would be best served by the company pursuing its growth plans at its operations in the Pilbara region of Western Australia.
"I am paid to never say never, but I can say that the value that we see in front of the company is very, very strong," he said.
"The option on the growth of Asia, which Fortescue shareholders have, is enormous and unless BHP or anyone else can show them a shorter path to that growth, then we will stick to the current plan."
LINK:
http://www.theaustralian.news.com.au/business/story/0,28124,24777156-36418,00.html
Would be interesting if BHP make a comment in relation to the possible t/over
chops_a_must
Printing My Own Money
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Why would they bother with FMG?
They are riddled with debt, and that's the reason they left RIO alone. And RIO has some stunningly good Iron Ore assets.
As opposed to FMG, which from reports I'm hearing from on the ground, have absolutely shizen grades and the geos simply do not know what they are doing.
Why would BHP bother?
Typical BS ramping from Twiggy once again.
They are riddled with debt, and that's the reason they left RIO alone. And RIO has some stunningly good Iron Ore assets.
As opposed to FMG, which from reports I'm hearing from on the ground, have absolutely shizen grades and the geos simply do not know what they are doing.
Why would BHP bother?
Typical BS ramping from Twiggy once again.
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BHP could pay 2Billions dollars for the whole FMG easily and get rid of all the problems they are generating with trains and ports.
WBII
Dec 09, 2008, Carol Chan and Bloomberg, 533 words
The mainland, the world's largest consumer of iron ore, may ask the three biggest producers to accept an 82 per cent price cut because steel prices have plunged, but market watchers said such a large discount seemed unrealistic.
one of the articles from china news
surely there are a lot of ongoing dramas which will have an effect on all iron ore producers whether positive or negative
i am sure the whole situation will play out like a good game of chess
The mainland, the world's largest consumer of iron ore, may ask the three biggest producers to accept an 82 per cent price cut because steel prices have plunged, but market watchers said such a large discount seemed unrealistic.
one of the articles from china news
surely there are a lot of ongoing dramas which will have an effect on all iron ore producers whether positive or negative
i am sure the whole situation will play out like a good game of chess
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IMO if 85 to 90 % price increase was possible in the begining of this year in the name of increased demand, increased freight cost etc then 82% price reduction is not a discount. It will be still a net gain with industry demand situation, lower freight cost and better break even situation. If the three big producers increase their efficiency, cut down the redundant fats (lot of business improvement and excellece teams with high salary with no improvement or excellence), cutting down the STIP (short term imporvement program and allowing GM and MD to get 60% bonus), cutting down expensive site allowance some 65 % in some places leave alone high salary then the companies will still make profit generously to give back somethign to sharehodlers
IMO if 85 to 90 % price increase was possible in the begining of this year in the name of increased demand, increased freight cost etc then 82% price reduction is not a discount. It will be still a net gain with industry demand situation, lower freight cost and better break even situation. If the three big producers increase their efficiency, cut down the redundant fats (lot of business improvement and excellece teams with high salary with no improvement or excellence), cutting down the STIP (short term imporvement program and allowing GM and MD to get 60% bonus), cutting down expensive site allowance some 65 % in some places leave alone high salary then the companies will still make profit generously to give back somethign to sharehodlers
Of course it is a discount - what would happen to the price following a 200% increase followed by a 100% decrease?
Here are the figures (for 90% increase followed by 82% decrease) if you still can't work it out
Initial Price: 100
90% Increase: 190
82% Decrease: 34.2 = 65.8% loss on initial price
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did anyone else here FMG's assets look attractive to BHP
it was mentioned on sky business channel
though i am not sure if selling FMG's assets is a good thing
it was mentioned on sky business channel
though i am not sure if selling FMG's assets is a good thing
FMG - drowning in debt (next Allco?)
Far too much attention has been directed to it's bus. model and (potential) P.E. Ratio but almost none towards the fact that it is swimming in debt, most of it current debt at that.
I'm holding out until they can clear this up.
Thoughts ?
Far too much attention has been directed to it's bus. model and (potential) P.E. Ratio but almost none towards the fact that it is swimming in debt, most of it current debt at that.
I'm holding out until they can clear this up.
Thoughts ?
Garpal Gumnut
Ross Island Hotel
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Re: FMG - drowning in debt (next Allco?)
You'd need to back this up with figures and perhaps post it in the FMG forum under asx stocks.
gg
You'd need to back this up with figures and perhaps post it in the FMG forum under asx stocks.
gg
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Fortescue Metals Group has plunged 7.2 per cent in early trading after analyst reports yesterday claimed the WA iron ore miner’s decision to suspend shipping contracts could cost it $US300 million.
An analyst at investment bank Morgan Stanley Australia also said Armanda Shipping of Singapore had lodged a legal case against Fortescue with the US Federal District Court, which it believed related to the cancellation or non-payment of shipping contracts by the miner.
The report forecasted a loss of $542 million for Fortescue for the first half of 2008-09 due to a number of factors including shipping losses.
Fortescue subsequently issued a statement to the Australian Securities Exchange this morning in which the company said it was seeking legal advice ahead of taking decisive action over 10 shipping contracts.
“Each of the 10 contracts that have been actioned need to be considered on their specific facts and merits as Fortescue will use the all the appropriate legal mechanisms for determining the disputes that have arisen between some of the parties and any future disputes that may arise,” the company said.
The statement was issued following reports earlier this month that Fortescue was looking to suspend long-term vessel charter contracts due to plunging freight rates and the slump in Chinese demand for iron ore.
Fortescue put the contracts in place earlier this year when cape-size iron ore carriers where difficult to tie down due to the booming iron ore market but has not yet revealed details of the shipping arrangements, nor the financial impact of its decision to suspend the charter agreements.
The Baltic Capesize Index (BCI), which measures the charter rate for the biggest iron ore carriers, has fallen more than 90 per cent in the past six months as part of a global collapse in freight rates.
The plunging BCI has resulted in Fortescue dealing with freight rates well above the charter spot price.
Fortescue shares had dropped 19 ¢ to $2.44 by 10.27am.
PERTH
DALE MILLER
An analyst at investment bank Morgan Stanley Australia also said Armanda Shipping of Singapore had lodged a legal case against Fortescue with the US Federal District Court, which it believed related to the cancellation or non-payment of shipping contracts by the miner.
The report forecasted a loss of $542 million for Fortescue for the first half of 2008-09 due to a number of factors including shipping losses.
Fortescue subsequently issued a statement to the Australian Securities Exchange this morning in which the company said it was seeking legal advice ahead of taking decisive action over 10 shipping contracts.
“Each of the 10 contracts that have been actioned need to be considered on their specific facts and merits as Fortescue will use the all the appropriate legal mechanisms for determining the disputes that have arisen between some of the parties and any future disputes that may arise,” the company said.
The statement was issued following reports earlier this month that Fortescue was looking to suspend long-term vessel charter contracts due to plunging freight rates and the slump in Chinese demand for iron ore.
Fortescue put the contracts in place earlier this year when cape-size iron ore carriers where difficult to tie down due to the booming iron ore market but has not yet revealed details of the shipping arrangements, nor the financial impact of its decision to suspend the charter agreements.
The Baltic Capesize Index (BCI), which measures the charter rate for the biggest iron ore carriers, has fallen more than 90 per cent in the past six months as part of a global collapse in freight rates.
The plunging BCI has resulted in Fortescue dealing with freight rates well above the charter spot price.
Fortescue shares had dropped 19 ¢ to $2.44 by 10.27am.
PERTH
DALE MILLER
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Valuation at 20c?
From:
http://business.watoday.com.au/business/fortescue-in-flux-20081217-6zy1.html?page=2
It is interesting to note the changes in assumptions and outlook in the Morgan Stanley coverage.
In the first report, forecast prices in the MS model showed:
Iron ore (fines) $US/ton 2008: $58, 2009: $87, 2010: $108, 2011: $116 and 2012: $114 and a LONG TERM PRICE: $US60.
Iron ore (lump) $US/tn 2008: $74, 2009: $111, 2010: $138, 2011: $148 and 2012: $146 and LONG TERM PRICE: $US77.
This generated a price target of $8.39 when FMG was trading at $6.00 (40% upside).
In yesterday's report however:
Iron ore (fines) $US/ton 2008: $51, 2009: $93, 2010: $65, 2011: $65 and 2012: $78 and LONG TERM PRICE : $US82.
Iron ore (lump) $US/ton 2008: $66, 2009: $118, 2010: $83, 2011: $83 and 2012: $99 and LONG TERM PRICE : $US104.
This generated a price target of $1.06 when FMG was trading at $2.63 (60% downside).
Price increase
While the world has got a lot darker since March, particularly the outlook for commodity prices reverting to long-term averages, Morgan Stanley's prices have actually increased by 36% for fines and 35% for lump.
What would have happened if the analysts had not lifted their long-term iron ore price assumptions by 35%? The value for Fortescue under a DCF (discounted cash flow) valuation would be marginal.
I can only say that this company based on those numbers is highly overvalued, it seems that based on DCF its valuation would be 20c.
you cna only expect bad news coming from FMG from now on.
WBII
From:
http://business.watoday.com.au/business/fortescue-in-flux-20081217-6zy1.html?page=2
It is interesting to note the changes in assumptions and outlook in the Morgan Stanley coverage.
In the first report, forecast prices in the MS model showed:
Iron ore (fines) $US/ton 2008: $58, 2009: $87, 2010: $108, 2011: $116 and 2012: $114 and a LONG TERM PRICE: $US60.
Iron ore (lump) $US/tn 2008: $74, 2009: $111, 2010: $138, 2011: $148 and 2012: $146 and LONG TERM PRICE: $US77.
This generated a price target of $8.39 when FMG was trading at $6.00 (40% upside).
In yesterday's report however:
Iron ore (fines) $US/ton 2008: $51, 2009: $93, 2010: $65, 2011: $65 and 2012: $78 and LONG TERM PRICE : $US82.
Iron ore (lump) $US/ton 2008: $66, 2009: $118, 2010: $83, 2011: $83 and 2012: $99 and LONG TERM PRICE : $US104.
This generated a price target of $1.06 when FMG was trading at $2.63 (60% downside).
Price increase
While the world has got a lot darker since March, particularly the outlook for commodity prices reverting to long-term averages, Morgan Stanley's prices have actually increased by 36% for fines and 35% for lump.
What would have happened if the analysts had not lifted their long-term iron ore price assumptions by 35%? The value for Fortescue under a DCF (discounted cash flow) valuation would be marginal.
I can only say that this company based on those numbers is highly overvalued, it seems that based on DCF its valuation would be 20c.
you cna only expect bad news coming from FMG from now on.
WBII
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Re: Valuation at 20c?
I certainly hope you are right
I (and others I know) all want to buy FMG back around $1 - $1.20!!
though it seems to have built good support at $2?
Demand for IO will remain, i think it's manipulation by China at the moment + olympic games
I certainly hope you are right
I (and others I know) all want to buy FMG back around $1 - $1.20!!
though it seems to have built good support at $2?
Demand for IO will remain, i think it's manipulation by China at the moment + olympic games
