FMG - Morgans rates the stock as Hold
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Morgans believes the stock is trading close to fair value, and with benchmark iron ore prices back above US$70/t the broker downgrades to Hold from Add.
The broker suspects the stock could rally from this point if the large discounts on its lower-grade iron ore starts to normalise towards the long-term range. To get there though, China needs to absorb a large stockpile that has been building at port. Target is $5.95.
Target price is $5.95.Current Price is $5.67. Difference: $0.28 - (brackets indicate current price is over target). If FMG meets the Morgans target it will return approximately 5% (excluding dividends, fees and charges - negative figures indicate an expected loss).
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