Fortescue's first-quarter shipments of 46 million metric tons were 6% lower on a year ago and 11% down on the prior quarter. Sales volumes were 4 million below shipments as it negotiates with China Mineral Resources Group, which, with higher diesel costs and inflation, sees unit costs up 21%.
Fortescue provides strong leverage to the Chinese economy. If growth in steel consumption remains strong, it's also likely iron ore prices and volumes will, too.
We think that ultimately Chinese fixed-asset investment will slow, and future iron ore volume growth and prices are likely to be much less favorable.
|
Metric
|
FMG
|
BHP
|
RIO
|
|---|---|---|---|
Price/Earnings (Normalized) | 8.27 | 13.46 | 12.93 |
Price/Book Value | 1.52 | 4.01 | 2.57 |
Price/Sales | 1.81 | 3.36 | 2.70 |
Price/Cash Flow | 4.48 | 8.42 | 8.10 |
|
Metric
|
FMG
|
BHP
|
RIO
|
|---|---|---|---|
Quick Ratio | 1.70 | 1.44 | 0.93 |
Current Ratio | 2.32 | 1.88 | 1.42 |
Interest Coverage | 13.01 | 11.36 | 10.65 |
|
Metric
|
FMG
|
BHP
|
RIO
|
|---|---|---|---|
Return on Assets (Normalized) | 11.10% | 11.44% | 10.13% |
Return on Equity (Normalized) | 17.01% | 27.20% | 20.84% |
Return on Invested Capital (Normalized) | 13.71% | 17.58% | 15.78% |
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