Should you look at these three Resources Stocks?

Fortescue Metals Group Ltd

FMG Details
Significant cost reduction and positive results: For the first half year 2017, Fortescue Metals Group Ltd(ASX: FMG) recently clarified that media reports about submitting an indicative bid for Wesfarmers Curragh coal mine assets are incorrect. For half year FY17, FMG recorded a 34% increase to $4,492 million in revenue as compared to $3,344 million in a year-ago period. Meanwhile, net profit after tax stood at US$1.2 billion and underlying EBITDA at US$2.6 billion as compared to $319 million and $1.3 billion in the same period a year-ago. FMG recorded further improvement in C1 costs to US$13.06/wmt and shipped 86.1 million tonnes for the half year which is ahead of its targets. Fortescue has given FY17 C1 cost guidance of US$12-13/wmt and is on target to offset the impact of increased oil costs and a higher Australian dollar. Led by productivity improvements and consistent cash returns from its assets, the company board declared A$0.20 per share fully franked interim dividend.
 

Cost Savings (Source: Company Reports)
 
Looking ahead, FMG had maintained its guidance for iron ore shipments of 165-170 million tonnes with a C1 cost of US$12-13 per wet metric tonne for full year. On the other hand, concerns around currency and commodity price do prevail.FMG stock fell about 5% on March 03, 2017 post exploding about 194.22% in the last one year (as at March 02, 2017), and we believe it is "Expensive" at the current share price of $ 6.28


FMG Daily Chart (Source: Thomson Reuters) 

Woodside Petroleum Ltd

WPL Details
High profit levels with lower unit production costs: For full year, Woodside Petroleum Ltd (ASX: WPL) recorded a full year reported net profit after tax of $868 million. Unit production costs reduced 28% to $5.0/boe from previous year. Portfolio gross margins were higher by 16% to 45%.
 

Dividend Yield Comparison (Source: Company Reports)
 
Led by strong cash flow from operations of $2.6 billion and positive free cash flow of $114 million, WPL declared a final dividend of 49 US cents per share taking full year dividend to 83 US cents per share. In terms of operations, Woodside achieved annual production of 94.9 MMboe, 3% higher than 2015 level and the second highest level ever. Based on the above stated strong fundamentals, we rate the stock “Buy” at the current share price of $ 30.70


WPL Daily Chart (Source: Thomson Reuters) 

Magnis Resources Ltd

 
MNS Details
Cash flow scenario: Magnis Resources Ltd.’s (ASX: MNS) stock fell about 13.04% in last one month (as at March 02, 2017). The fall seems to be owing to some level of volatility and concerns over cash flow scenario. The group had reported for negative cash flow for development of the order of $3.74 million for the quarter ended December 2016. Further, the operating cash flow for the period was ($5.43 million) while payments for exploration and evaluation were of the order of ($976,000). Investing cash flow was ($5,000) while cash flow from financing activities was $1.69 million. MNS reported for cash in hand of about $2.37 million at the end of the December quarter against $6.1 million as at previous quarter. The group expects cash outflows of $2.84 million for the next quarter and stated that the estimated deficit of $0.48 million is to be funded from both listed and unlisted option conversion to date. MNS also indicated that the working capital will be funded further via option conversions given the expiry date of 31 May 2017 for the ASX listed MNSO. On the other hand, the group has been progressing well with the development of its Nachu Graphite Project. Significant progress was made with Thermo Gravimetric Analysis of graphite flakes produced using only physical steps (milling and flotation processes) with purity >99.95%. Project Financing and Offtake MOU has been signed with credible partner, ROSATOM, in January 2017. Recently, director, Frank Poullas, had acquired about 5,145 ordinary shares under on-market purchase. We maintain a “Buy” on the stock at the current price of $ 0.60


MNS Daily Chart (Source: Thomson Reuters)

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