Jefferies cuts PT on Australia's Fortescue amid CMRG negotiations hurdle

Fortescue

Yesterday 23:43

** Analysts at Jefferies lower price target for Fortescue FMG.AX to A$16 from A$17; keep "hold" rating
** The iron ore miner said on Thursday that operations may be affected if CMRG supply contracts and price negotiations are not concluded by year-end
** Fortescue's Q1 iron ore sales stood at 42.9 million metric tons, below analysts' estimates and over 9% below iron ore shipments of 46.8 million tons 
** Jefferies says sales will continue to lag by 4-5 million metric tons each month until the year-end or the conclusion of negotiations
** Despite strong cash generation, cost headwinds, and the downside risk to sales volume and pricing for the year prevent us from turning more constructive on FMG - Jefferies
** FMG down 33.8% YTD, as of last close

 (Reporting by Keshav Singh Chundawat in Bengaluru)
 ((Keshav.singhchundawat@thomsonreuters.com))