FMG - will we see low $2+ ?

Discussion in 'Stocks & Derivatives' started by Lunardragon, Sep 8, 2012.

  1. Lunardragon

    Lunardragon Well-Known Member Silver Stacker

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    Another iron ore company on my watchlist.

    Currently got hammered due to heavy debt laden and fall in iron ore price.
    Fire asset sale started already to shore up their balance sheet.
    They reckon if capital raising kicks in and/or asset sales, then FMG SP will trade low $2.

    Valued traders out there, your opinion?

    LD
     
    Lunardragon, Sep 8, 2012
    #1
  2. dollars

    dollars Active Member Silver Stacker

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    .
     
    dollars, Sep 8, 2012
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  3. finicky

    finicky Well-Known Member Silver Stacker

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    Good succinct summary of the situation I think. Rapid expansion using debt to mine a commodity that looks in decline. That's a recipe for hard times eventually. I don't have it on a watchlist but if I did it'd just stay there, on watch.
    Ok it's had a bounce and the mthly candle is a candidate for a low but personally I would not be betting that there's much in it - not yet anyway. $2 doesn't look impossible. Just my sense of it I've never taken an interest in FMG. I've read though that they're on a lower profit margin because their ore is not as high quality as BHP or RIO, and what with interest burden on debt there's no cushion against declining iron ore price. There are knocked down service providers paying good yield that are more prospective than this.
     
    finicky, Sep 8, 2012
    #3
  4. Lunardragon

    Lunardragon Well-Known Member Silver Stacker

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    Yes...reality bites.

    AF really needs to stir this again once more otherwise .....
     
    Lunardragon, Sep 8, 2012
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  5. Roswell Crash Survivor

    Roswell Crash Survivor Well-Known Member Silver Stacker

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    FMG - Fortescue Metals

    November 21st, 2008

    High/Low/Close
    1.94/1.16/1.80
     
    Roswell Crash Survivor, Sep 8, 2012
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  6. Nukz

    Nukz New Member

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    I'm very very cautious with this one and others like it. The company has a massive debt overhang i would be worried if it breaks anywhere close to those 2008 low's the company will prob go under.....
     
    Nukz, Sep 8, 2012
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  7. Lunardragon

    Lunardragon Well-Known Member Silver Stacker

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    I doubt the big boys let it fall below that... I really do.
     
    Lunardragon, Sep 8, 2012
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  8. finicky

    finicky Well-Known Member Silver Stacker

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    finicky, Sep 8, 2012
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