Fortescue Metals beat on all of shipments, realised prices and costs in the December quarter. Guidance remains unchanged but currency headwinds are beginning to drag, the broker notes.
This will lead not only to higher cash costs in FY21 but increased capex for Iron Bridge. That said, earnings momentum remains strong on bouyant iron ore prices. Target falls to $26.50 from $27.00, Outperform retained.
Sector: Materials.
Target price is $26.50.Current Price is $22.73. Difference: $3.77 – (brackets indicate current price is over target). If FMG meets the Macquarie target it will return approximately 14% (excluding dividends, fees and charges – negative figures indicate an expected loss).
