In today’s briefing:
- S&P/ASX Index Rebalance Preview: Potential Changes from Now to September
- [Iron Options Weekly 2024/28] Supply/Demand Outlook for Iron Ore Outweighs Stimulus Hopes
- ZIP Placement – Worth a Small Punt, at Best
- Fortescue Metals Group (FMG AU): High Dividend Yield of 9%, What to Expect From Q4 FY24
S&P/ASX Index Rebalance Preview: Potential Changes from Now to September
- With nearly 80% of the review period complete, there could be 28 adds/deletes across the S&P/ASX family of indices in September.
- There is a lot of stocks for passive trackers to trade on the index changes with the largest impacts on the potential changes to the S&P/ASX 200 (AS51 INDEX).
- The potential adds have outperformed the potential deletions by a LOT over the last few months and continued positioning could lead to further gains.
[Iron Options Weekly 2024/28] Supply/Demand Outlook for Iron Ore Outweighs Stimulus Hopes
- Following the iron ore rally at the start of the month, prices have corrected sharply lower owing to downbeat economic data and an inventory buildup.
- Option activity over the past week was notably skewed towards put options suggesting a negative sentiment. Weekly options volume was sharply lower WoW.
- Recent bearish sentiment has been accompanied by a decline in IV. Outcome from the plenary meeting is likely to reignite volatility in the coming weeks.
ZIP Placement – Worth a Small Punt, at Best
- Zip (ZIP AU) plans to raise around US$145m in order to repay its outstanding debt.
- The company has undertaken a number of deals in the past and has a mixed track record.
- In this note, we will talk about the placement and run the deal through our ECM framework.
Fortescue Metals Group (FMG AU): High Dividend Yield of 9%, What to Expect From Q4 FY24
- Fortescue Metals (FMG AU) trades at a steady dividend yield of 9%, assuming a 115 USD/ton iron ore price and an 80% payout.
- The payout risk lies in incremental capex spend on green energy in future years. For FY24, the company has committed USD 500 mn (overall capex 3.0-3.2 bn USD).
- We expect shipments of ~54 million tons for Q4 FY24 (in its production report to be released on 25th July) and 192 million tons for FY24 (flat YoY).
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Data and News
- ✓ Events & Webinars
