Morgan Stanley says go “overweight” FMG:
“If we assume 90 per cent price realisation, FMG C1 cash costs and sustaining capex maintained at $US15 a tonne and $US2 a tonne from FY16 to FY20, respectively, with our base-case currency assumptions, we estimate the required headline iron ore price for FMG to repay all its debt when it falls due to be about $US47 a dry metric tonne. This implies capacity for both debt reduction and capital returns at current prices.”
What a shame prices are going to halve.
