Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

Commodities

<ul>
<li>This is a follow-up on our insight from 2 weeks ago, <a href="https://www.smartkarma.com/insights/iron-ore-pullback-from-102-usd-ton-to-95-usd-ton" target="_blank" data-smartkarma-citation="insights:196969" rel="noopener">Iron Ore: Pullback From 102 USD/Ton to 95 USD/Ton</a>, where we estimated a pullback on the iron ore price. </li>
<li>With mill margins retreating into negative territory and TSF numbers (although healthy) coming far below street expectations, the stage is set for iron ore to retreat to 95 USD/ton. </li>
<li>Despite iron ore prices retreating to the 95 USD/ton level, we like <a href="https://www.smartkarma.com/entities/fenix-resources-ltd" target="_blank" data-smartkarma-citation="entities:7405:1" rel="noopener">Fenix Resources (FEX AU)</a>(Read: <a href="https://www.smartkarma.com/insights/fenix-resources-tripling-of-production-achieved-1-2x-price-ocf" target="_blank" data-smartkarma-citation="insights:197917" rel="noopener">Fenix Resources Tripling of Production Achieved, 1.2x Price/OCF</a> ).</li>
</ul>


This is a follow-up on our insight from 2 weeks ago, Iron Ore: Pullback From 102 USD/Ton to 95 USD/Ton, where we estimated a pullback on the iron ore price. 
With mill margins retreating into negative territory and TSF numbers (although healthy) coming far below street expectations, the stage is set for iron ore to retreat to 95 USD/ton. 
Despite iron ore prices retreating to the 95 USD/ton level, we like Fenix Resources (FEX AU)(Read: Fenix Resources Tripling of Production Achieved, 1.2x Price/OCF ).


Iron Ore: Reiterate Fall to 95 USD/Ton In the Near Term

<ul>
<li>
<a href="https://www.smartkarma.com/entities/fenix-resources-ltd" target="_blank" data-smartkarma-citation="entities:7405:1" rel="noopener">Fenix Resources (FEX AU)</a> commenced operations of its third mine, the Beebyn-W11, with the shipment of 60k tons from the port of Geraldton.</li>
<li>Beebyn-W11, Fenix’s third operating mine in the Midwest, is now operating at the planned FY26 production rate of 1.5 million tonnes per annum (Mtpa).</li>
<li>As a result, Fenix is now mining, hauling, loading and shipping at a combined run rate of more than 4Mtpa from the Company’s three mines. </li>
</ul>



Fenix Resources (FEX AU) commenced operations of its third mine, the Beebyn-W11, with the shipment of 60k tons from the port of Geraldton.
Beebyn-W11, Fenix’s third operating mine in the Midwest, is now operating at the planned FY26 production rate of 1.5 million tonnes per annum (Mtpa).
As a result, Fenix is now mining, hauling, loading and shipping at a combined run rate of more than 4Mtpa from the Company’s three mines. 


Fenix Resources Tripling of Production Achieved, 1.2x Price/OCF

<ul>
<li>
<a href="https://www.smartkarma.com/entities/fortescue-metals-group-ltd" target="_blank" data-smartkarma-citation="entities:41:1" rel="noopener">Fortescue Metals (FMG AU)</a> announced disappointing results, with revenues/profits down 16%/53% YoY, disappointing consensus slightly by 4-5%. </li>
<li>Capex accelerated to 3.5-3.8 bn USD annually, vs the initial 3.2-3.5 USD. The company reduced its decarbonization capex to 400-500 mn USD from the initial &gt;700 mn USD. </li>
<li>
<a href="https://www.smartkarma.com/entities/fortescue-metals-group-ltd" target="_blank" data-smartkarma-citation="entities:41:1" rel="noopener">Fortescue Metals (FMG AU)</a>  dividend payout ratio has reverted to its base level of 65%, yielding a modest 5.3% based on H1FY25's 50-cent distribution.</li>
</ul>



Fortescue Metals (FMG AU) announced disappointing results, with revenues/profits down 16%/53% YoY, disappointing consensus slightly by 4-5%. 
Capex accelerated to 3.5-3.8 bn USD annually, vs the initial 3.2-3.5 USD. The company reduced its decarbonization capex to 400-500 mn USD from the initial &gt;700 mn USD. 

Fortescue Metals (FMG AU)  dividend payout ratio has reverted to its base level of 65%, yielding a modest 5.3% based on H1FY25's 50-cent distribution.


Fortescue Metals Group (FMG AU): The Thrill Is Gone, And So Has The Dividend

<ul>
<li>Fenix Resources (FEX AU) delivered impressive results for Q2 2025. Sales increased by 71% QoQ and 68% YoY, driven by the ramp-up of the Shine iron ore mine.</li>
<li>The Beebyn-W11 mine, projected to ramp up production to 4 million tonnes from the current 2.5 million tonnes, is anticipated to receive final mining approval in the current quarter.</li>
<li>Trading at 5.9x FY25e PE with 57 mn AUD in net cash, which accounts for 27% of its market capitalization, the stock is worth a look. </li>
</ul>


Fenix Resources (FEX AU) delivered impressive results for Q2 2025. Sales increased by 71% QoQ and 68% YoY, driven by the ramp-up of the Shine iron ore mine.
The Beebyn-W11 mine, projected to ramp up production to 4 million tonnes from the current 2.5 million tonnes, is anticipated to receive final mining approval in the current quarter.
Trading at 5.9x FY25e PE with 57 mn AUD in net cash, which accounts for 27% of its market capitalization, the stock is worth a look. 


Fenix Resources (FEX AU) Q2 FY25 Update: Close to Tripling Production

<ul>
<li>
<a href="https://www.smartkarma.com/entities/fenix-resources-ltd" target="_blank" rel="noopener">Fenix Resources (FEX AU)</a> will increase production from 1.4 to 4.1 million tons annually in early CY25, placing it at 2.5x PE/0.3x EV-EBITDA FY26e (~100 USD/ton iron ore px assumption). </li>
<li>On our estimates, if the company pays no dividend and capex is 60 mn AUD in both FY25 and FY26, net cash&gt;market capitalization. <strong>(Conclusion: Board Pays Dividend)</strong>
</li>
<li>We will look for the next quarterly production update for more color this month. Read our last update <a href="https://www.smartkarma.com/insights/fenix-resources-fex-au-positive-developments-at-iron-ridge-and-other-catalysts" target="_blank" data-smartkarma-citation="insights:169207" rel="noopener">Fenix Resources (FEX AU): Positive Developments At Iron Ridge And Other Catalysts</a> </li>
</ul>



Fenix Resources (FEX AU) will increase production from 1.4 to 4.1 million tons annually in early CY25, placing it at 2.5x PE/0.3x EV-EBITDA FY26e (~100 USD/ton iron ore px assumption). 
On our estimates, if the company pays no dividend and capex is 60 mn AUD in both FY25 and FY26, net cash&gt;market capitalization. (Conclusion: Board Pays Dividend)

We will look for the next quarterly production update for more color this month. Read our last update Fenix Resources (FEX AU): Positive Developments At Iron Ridge And Other Catalysts 


Fenix Resources (FEX AU): Deep Value, >35% of Mkt Cap in Cash, 2.5x PE/0.3 EV-EBITDA on Ramp Up

Australia

Fenix Resources Ltd operates as a resource exploration company. The Company explores for iron ore, vanadium, and manganese. Fenix Resources develops its projects in Australia.

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Fenix Resources (FEX AU)

Iron Ore: Reiterate Fall to 95 USD/Ton In the Near Term

Underwhelming TSF data, lacklustre China steel production/apparent demand numbers, and negative China mill margins will catalyze a short-term...

Sameer Taneja

Fenix Resources Tripling of Production Achieved, 1.2x Price/OCF

Fenix Resources (FEX AU) has achieved a significant milestone in increasing its production to 4 million tons. At a steady production price...

Sameer Taneja

Fortescue Metals Group (FMG AU): The Thrill Is Gone, And So Has The Dividend

We summarize the results of FMG AU for H1 FY25 and our gleanings from the conference call on the 20th of Feb. Based on the current payout of 65%,...

Sameer Taneja