Fortescue Ltd (ASX: FMG)
I would like your opinion as to why FMG has crashed - was forecast to be in the mid $20s by MM now around $16
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Answer
Hi Raymond,
We last wrote about Fortescue Ltd (ASX: FMG) in detail, when the stock was trading ~$18, in August after their FY26 result here, with our summary being:
- “FMG remains a leveraged exposure to iron ore and China. We think the stock looks fair rather than compelling here.”
The stock is currently hovering around $16.60 as the iron ore (Fe) price attempts to reclaim the psychological US$100/MT level and whether the stock can bounce back towards the $18-19 area is likely to be determined by the bulk commodity – the 6% fully franked yield remains attractive, but this is an “edgy” position within our Income Portfolio with earnings a function of Fe.
Our view is unchanged from the update earlier in the month here, also noting that FMG traded ex-dividend 46c + franking on 1st Sept.
- MM is long and cautiously bullish towards FMG for income.
