In today’s briefing:
- Auswide Bank (ABA AU)/ MyState (MYS AU) Merger: A Done Deal
- [IO Technicals Weekly 2024/42] Iron Ore Price Reversal Continues
- Fenix Resources (FEX AU): Small Cap Iron Ore Miner With Great Upside
Auswide Bank (ABA AU)/ MyState (MYS AU) Merger: A Done Deal
- The Auswide Bank (ABA AU) IE has considered Mystate Ltd (MYS AU)’s all-scrip merger offer in the best interests of the Auswide shareholders. However, the opinion comes with caveats.
- The offer is conditional on Auswide shareholder and regulatory approvals (ACCC, Treasury). The scheme meeting is on 2 December.
- Vote risk is low due to the lack of substantial shareholders and the disinterested retail base. At the last close and for 18 December payment, the gross/annualised spread was 1.6%/10.3%.
[IO Technicals Weekly 2024/42] Iron Ore Price Reversal Continues
- SGX IO Futures fell for the second consecutive week, closing USD 4.15/ton lower at USD 101.70/ton on 18/Oct, with a trading range of USD 9.75/ton.
- Short-Term moving averages signaled a bearish reversal, with a downward 9-day moving average and failure to break above key pivot points.
- Heavy selling pressure and expanded China stimulus measures disappointed market expectations, signaling continued bearish trends with a potential test of USD 97.5/ton support.
Fenix Resources (FEX AU): Small Cap Iron Ore Miner With Great Upside
- Fenix Resources (FEX AU) is a small-cap iron ore miner/logistics provider with massive upside based on an increasing sales profile from 1.3 to 4 million tons over FY25/26.
- The company is also positioning itself as a logistics provider with the potential to transport 10 million tons of material through the Geraldton Port with its infrastructure in place.
- Trading at 5.4x FY25e PE with a 1.8 EV-EBITDA, >38% of the market cap in cash, this is a stock worth exploring.
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