Buy, Sell, Hold: FMG, St Barbara and Breaker

THE latest figures on FMG and St Barbara following quarterly reports, as well as the verdict on Breaker's maiden resource.

Buy, Sell, Hold: FMG, St Barbara and Breaker Buy, Sell, Hold: FMG, St Barbara and Breaker Buy, Sell, Hold: FMG, St Barbara and Breaker Buy, Sell, Hold: FMG, St Barbara and Breaker Buy, Sell, Hold: FMG, St Barbara and Breaker

Fortescue Metals Group (FMG)

Analyst: Lyndon Fagan, JP Morgan

Recommendation: Overweight

Price target: A$5

Thursday's close: $4.49

Reason: Softer volumes and price discount, but margins still provide strong free cashflow

Comments: Key takeaways from the March 2018 quarterly were 1) volumes were lower than our forecast running at 157Mtpa -4% quarter-on-quarter, we now expect 167Mt for FY18, just short of 170Mt guidance, 2) achieved pricing remained weak, with a 38% discount the highest on record (average revenue ~$41/t), although all-in costs remain low at sub $30/t, and 3) C1 costs rose ~$1/t QoQ to $13/t due to low volume, higher FX and oil. While the quarterly results were relatively soft, the company continues to gen...

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