With Fortescue's decision to scale back their hydrogen ambitions, companies tied to the story of Green Hydrogen in panic mode with United Hydrogen and Sunshine Hydro talking about their story in the AFR:
For a bit of background, United Hydrogen Limited is a conglomerate (ahem "roll-up") of hydrogen related businesses led by Will Davidson. Apparently Will Davidson used to be CEO of Powerwrap before it got taken over by Praemium.
To get a sense of the size of this "roll-up" just look at the picture below:
That's a crazy amount of companies and puts UWL to shame. And when I get constant emails from UHL about "Pre-IPO" capital raising for "sophisticated investors" and videos with talking head "investor" "Mark Bouris" of Yellow Brick Road, red flags start to appear (I have myself to blame though after clicking the "INVEST IN UHL" button on their website a year ago!).
Pity I'm not a sophisticated investor so can't invest but having the emails means I can keep track of all the raises.
The most recent raise was at 25c. Yet after countless capital raisings the company is valued at over $600m but at one stage I did get an email that they did reach a value of $1bn.
Anyway back to Fortescue. Andrew Forrest appeared on ABC 7:30 and seemed to struggle on a few questions relating to the company's hydrogen ambitions. Not reassuring for all the companies focused on Green Hydrogen and also Davidson's plans to list United Hydrogen on the ASX.
Flipside from Fortescue scaling back on the Green Hydrogen story would have to be more dividends and cashflow and more focus back to mining. Downside would be all the companies out there tied to the Green Hydrogen story. Without a big company like Fortescue putting in the dollars and publicity, investment in this sector is harder to justify with these smaller companies - possibly prompting the story to be published in the AFR.
On the subject of electrification and EV, maybe Fortescue is the best electrication play?
A Russian cyberattack and allegations of wrongdoing.
Sells and holds across the board although some have revised up their price targets.
Simandou "Pilbara killer" waiting in the shadows?
It seems everyone is trying their hardest to press down FMG.
But the share price still trundles on and outperforming the likes of BHP and RIO. Not to mention the main index while FMG tries to shore up their EV business and electrify their operations.
This is where sometimes it is better to do your own research and ignore the naysayers.
Having said that, I think electrification is more than just batteries or Lithium. There is also the all the infrastructure that needs to support it. The hard part is finding an investment that captures all those areas.
Still considering whether to reenter after recently selling out. Sometimes it is hard to ignore the price action.
FMG has quite a bunch of sell recommendations. Price targets below $15.
Have to also add that many economists such as Saul Eslake always comment on FMG as having more downside to the Iron Ore price and always cite Simandou.
Yet share price stubbornly holds above $19.
Only theory I can think of is FFI. Or maybe investors betting FMG is secretly drilling their lithium tenements but not informing the market (see my previous straw). Plus no matter what, I think FMG will still be profitable at low prices.
Earnings per share estimates for anyone interested in watching the next financial year results
Did get out but still on my watchlist. Think the analysts are wrong and they are simply trying to get people to sell at lower prices.
Saw the Wildcat Resources announcement on acquiring some Lithium tenements and noticed that FMG has been also doing a bit of drilling also.
But so far I don't think FMG has found anything significant
Also according to the ABC they have some tenements in Ravensthorpe
However from one of the earnings transcripts dating back Oct 2022, FMG appears to think there is too much lithium at the moment and may explain the lack of activity in that tenement. Hard to say if FMG will be eventually proven right.
[held]
Hydrogen/Green Innovation
As no one had mentioned this, I thought I'd put this out there.
There is a teaser into their next generation mining fleet powered by Hydrogen.
Also they are looking at development of a Hydrogen plant in the Bells Bay Precinct, TAS.
Correct me if I'm wrong, but I haven't seen any other mining company doing what FMG is planning with their mining fleet.
Copper ground in South Australia
Another example of Fortescue diversification into copper - BigNE tenement. But not much discussion about it.
From a presentation given by Petratherm - another micro cap exploring near Prominent Hill.
FMG diversification from Iron Ore?
One example of FMG pegging ground in the Lachlan around ALK and MAG tenements.
There are other examples of FMG pegging ground in Fraser range (near the Nova site and where IGO and BUX are drilling for Ni) and the Kimberleys
