Citi upgrades Fortescue Metals to Buy from Neutral and reduces the target to $18.50 from $19.50. The broker suspects iron ore could hold at levels over US$100/t for longer than the market is currently factoring.
Longer-dated market concerns regarding large-scale iron ore exports from Guinea now look much less certain. Moreover, China’s leading indicators are stabilising and have headed higher from recent lows.
Sector: Materials.
Target price is $18.50.Current Price is $17.92. Difference: $0.58 – (brackets indicate current price is over target). If FMG meets the Citi target it will return approximately 3% (excluding dividends, fees and charges – negative figures indicate an expected loss).
