Charles Jillings, CEO of Utilico, energized by strong economic momentum across Latin America. Watch the video here.
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Agreed I have similarly tried trading on catalyst events and have had mixed results. For tomorrow main hope is we push up and hold nicely above 500 to support a bullish breakout.
I tried to trade Fxpo on catalysts event, it has been very disappointing for me. Financials are not going to be such a surprise, possibly dividend will be. Thing is to get them one has to remain invested post results.
Day of reckoning is here lets hope we can get well clear of £5 as this is the last major catalyst for a little while. Iron ore is still in major demand just too much in China’s case but the reality is this company prints money so should only be a bump in the road!
Sure iron ore recent correction has to be acknowledged, but I too believe is not going to be sustained and at any correction will follow an uppuard movement. Iron ore and steel are in huge demand, as I mentioned before for a government having to resource to cut production to controll prices is a bullish sign imo. Only yesterday i think the US Approved $1 bill infrastructure spending.....for Fxpo considering that first half average price was likely to be 260 premium included, even if for secon half will be less than current price at 180 premium included, the average for full year would make 220 or $ 2.6 bill revenue at a conservative 40%net profit is £800 millions or PE 3.5 circa. With these conservative considerations for 2021 results, Fxpo is still very much undervalued, in my analyses the average PE of 4.5 for 2017, 18, and 2020 is taken from PE Ranges from 3 to 7 during these years. We could say that Fxpo price is currently at lower range and as the potential to double this year in other to confirm a PE of 4.5 average, even with iron ore price lower in secon half. Therefore and assuming that iron ore price doesn't go below 150 65%fe, for any cinsiderable time, recently fxpo sp is just pausing, the uptrend is still intact, and is likely that after H1 announcements tomorrow and dividend declaration we will move higher. What for special dividend announcement maybe shortly after tomorrow H1, like last year, thought I would expect a substancial divi straight at H1 tomorrow.
All music to my ears and added another 1000 this morning
Even if you assume prices reduce to a 200 day average on the SGX 65% 7/2022 futures at $150 and remain at this level and build in a lower pellet premium ( i recall $30 mentioned in the report last year) it's still $180 and an eps of 112p so 600p comfortably. The only point made by the heckler last week at 7 am that I do agree with is that things don't tend to go up when the commodity is in a correction, but unlike Rhodium, iron isn't likely to be a huge swinger. So this is all about china issuing some comments again at the right time on a chart to knock the edge of a commodity and unsettle the traders. Give it a week and it's game on again just like copper was.
62% iron ore is likely to go to $140-150 on the chart, so the 65% will probably go to $170, that's the chart law usually.
65% next contract in front SGX , support channel near $179, same 65% SGX futures on july 2022 contract is $173 today, all pointing to $170 as a figure to use further ahead, with a pellet premium on top of say $60 gives you $230t or $2.65b revenue $1.16b net or £841m, eps of 143p pe today 3.35. DCE July 22 contract now $130 plus 65% premium and pellet premium $220. At this stage, I'm therefore guided towards using $220-230 per ton. I'm using a PE minimum of 5 but think 6-7 is fair value and still has a 40-50% discount to other producers. 700-900p area as fair, so same final conclusion as lucky, 100% here. So maybe not a good idea to run for the door when people shout fire in the theatre every morning.
2021 est eps 192 a good analysis Luciano very undervalued.
I have done a quick valuation comparison for the last 4 years.
From 2017 financial Fxpo had Earning Per Share of 50p and average PE of 5 (average PE is taken considering the effect financial results had on share price)
From 2018 financial Fxpo had Earning Per Share of 42p and average PE of 5.5
From 2019 financial Fxpo had Earning Per Share of 90p and PE of 2 (results came out in full pandemic )
From 2020 financial Fxpo had Earning Per Share of 80p and PE of 4.5.
Considerations:
2019 and 2020 PE valuation was not an average because share price after results did not changed in a meaningful way.
Exchange rate $/£ is at constant 1.35 for comparison purposes.
Conclusion :
We can assume that given normal circumstances Fxpo PE valuation is in the range of 4 to 5.
We should be take in consideration that also for the last 4 years Fxpo has reduced debit from $400 millions to Zero, equivalent to 50p per share, meaning that current Fxpo share price should be considered at 430p.
At current 480p and profit at £1billion the eps is 170p and PE is at 2.8 much lower that (4.5 PE average for 2017-2019-2020)
2019 valuation is excluded as results came out in unprecedent circumstances...
A reasonable assumption is that right now Fxpo is very much undervalued, been little more that half the value it should be.