Who’d a thunk it? Fortescue a yield play!

Tuesday, 22 August 2017

Via Bell:

Outstanding earnings growth

FMG has reported an earnings result for FY17 that has come in below market consensus and our estimates, despite profit growth of 112% yoy to US$2.1 billion (US67cps or A85cps for current P/E ratio of 6.5x). The exception was the declaration of a A$0.25/sh final dividend, for a total FY17 dividend of A$0.45/sh fully franked. This was 5% ahead of our A$0.43/sh forecast and 14% ahead of consensus. The strong result was driven by continued C1 cost reductions (down 17% yoy to US$12.82/wmt) and a high iron ore benchmark price (US$69.53/dmt vs US$51.37/dmt yoy).

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.