Fortescue Ltd is ending 2025 in a paradoxical spot: earnings have fallen sharply over the past year, yet the share price is trading at record levels and the company is doubling down on decarbonising iron ore production rather than its once-hyped green hydrogen mega-projects. Here’s a structured look at where Fortescue stands today for investors following FMG on Google News and Discover.
Fortescue share price today: near record highs
As of 9 December 2025, Fortescue Ltd (ASX: FMG) is trading at about A$22.53 per share on the ASX. That’s up roughly 2% on the day, versus a previous close of A$22.08. The stock has moved in a daily range of about A$21.96 to A$22.56, putting it right at the top of its 52‑week range of roughly A$13.18–A$22.56. [1]
Key valuation markers today:
- Market capitalisation: about A$68 billion. [2]
- Trailing P/E ratio: roughly 13.5x earnings, modest by large-cap growth standards but higher than when iron ore prices bottomed earlier in the year. [3]
- Dividend yield: around 5%, based on trailing twelve-month dividends. [4]
According to Investing.com, short‑term technical indicators currently flag FMG as a “Strong Buy”, reflecting a positive price trend and momentum near all‑time highs. [5]
Over a six‑month horizon, Fortescue’s shares have climbed more than 40%, supported by resilient iron ore prices and renewed optimism around demand, particularly from China. [6]
Earnings and dividends: lower profits, still generous cash returns
Under the hood, Fortescue’s profits are not at record levels.
Google Finance data for the fiscal quarter ended 30 June 2025 (Fortescue’s Q4 FY25) show: [7]
- Quarterly revenue: about US$3.95 billion, down roughly 9% year‑on‑year.
- Net income: about US$910 million, down around 22% year‑on‑year.
- Return on assets: roughly 11%, with return on capital in the low‑teens – still robust for a capital‑intensive miner.
Earlier in 2025, Bloomberg reported that Fortescue’s half‑year profit had slumped by around 53% versus the prior year as Chinese iron ore demand and benchmark prices weakened. [8]
Despite this earnings pressure, Fortescue continues to return substantial cash to shareholders:
- In February 2025, it paid an interim dividend of A$0.50 per share.
- In September 2025, it followed with a final dividend of A$0.60 per share.
- Total TTM dividends are about A$1.10 per share, implying a trailing yield of ~5% at today’s price and a payout ratio of roughly two‑thirds of earnings. [9]
The company highlights on its own website that it has distributed more than A$45 billion in dividends to shareholders over the last two decades, underscoring its identity as a high‑payout iron ore producer. [10]
Operational performance: record shipments and lower costs
Operationally, Fortescue remains one of the world’s most efficient iron ore miners.
FY25 and FY26 shipment guidance
In July 2025, Fortescue reported: [11]
- Record Q4 FY25 shipments of 55.2 million tonnes, up from 53.7 Mt a year earlier.
- Full‑year FY25 shipments of 198.4 Mt, hitting the top end of its 190–200 Mt guidance range.
At the same time, the company set FY26 shipment guidance at 195–205 Mt, including 10–12 Mt from its Iron Bridge magnetite project in Western Australia’s Pilbara region. [12]
In October 2025, Fortescue followed up with its Q1 FY26 production report: [13]
- Q1 iron ore shipments of 49.7 Mt, up about 4–4.2% year‑on‑year, a record first‑quarter level.
- C1 cash costs around US$18.17 per wet metric tonne, roughly 10% lower than a year earlier.
- Confirmation of the same FY26 shipment guidance (195–205 Mt).
Reuters and TradingView reported that this production update helped push Fortescue shares to a 10‑month high in October, as investors cheered the combination of higher volumes, strong realised prices and falling unit costs. [14]
Strategy pivot: from headline green hydrogen to “green iron” and batteries
Fortescue’s decarbonisation story has evolved significantly in 2025.
Hydrogen projects scrapped, iron ore core reinforced
In July 2025, the company announced that it would cancel two high‑profile green hydrogen projects after a strategic review: [15]
- The Arizona Hydrogen Project in the United States.
- The PEM50 hydrogen project in Gladstone, Australia.
Fortescue expects a pre‑tax writedown of around US$150 million associated with these projects, including electrolyser manufacturing equipment and engineering costs. [16]
Even as it scaled back hydrogen ambitions, Fortescue reaffirmed:
- FY26 shipments guidance of 195–205 Mt of iron ore.
- Metals capex of US$3.3–4.0 billion for FY26, focused on sustaining and expanding its mining operations and associated infrastructure. [17]
This shift has generally been interpreted as a move away from speculative early‑stage hydrogen export megaprojects and toward decarbonising the company’s core iron ore business, where cash flows are proven and scale advantages are clear.
New partnership with China’s Baowu and TISCO on green iron
On 3 December 2025, Reuters reported that Fortescue signed a technology development agreement with Taiyuan Iron & Steel (TISCO), a subsidiary of China Baowu, the world’s largest steelmaker. [18]
Key elements of the deal:
- The partners will test a hydrogen‑based, plasma‑enhanced ironmaking process aimed at removing conventional sintering, pelletising and coking steps – major sources of CO₂ emissions in steelmaking.
- The trial involves designing, building and operating an industrial line capable of producing 5,000 tonnes of hot metal, powered by Fortescue’s Pilbara iron ore. [19]
- Fortescue will fund the project, positioning its ore as a feedstock of choice for low‑emissions steel. [20]
This follows several 2025 announcements from Fortescue:
- Delivery of its first large‑scale BYD battery energy storage system (BESS) to North Star Junction in the Pilbara, a key milestone in reducing diesel use at its iron ore operations. [21]
- Securing A$45 million in funding from ARENA for a Pilbara Solar Innovation Hub, designed to push down the cost of renewables powering its mines. [22]
In short, Fortescue is now framing itself less as a pure‑play hydrogen hopeful and more as a “technology, energy and metals” group whose decarbonisation strategy revolves around green iron, batteries and renewables tightly integrated with its mining franchise. [23]
Analyst targets and valuation: price vs expectations
There is a clear disconnect between Fortescue’s near‑record share price and most published analyst targets.
Broker and consensus forecasts
Analyst data collated by Investing.com show: [24]
- Average 12‑month target price: around A$18.54, implying ~18% downside from today’s levels.
- Target range: roughly A$16.2 (low) to A$21.15 (high).
- Recommendation mix: a small number of “Buy” calls, more “Hold”, and several “Sell” ratings – summarised as an overall “Neutral” stance.
- Recent moves include Jefferies lifting its target to A$18.00 and JPMorgan and RBC maintaining A$20 and A$19 targets respectively in October, all below the current share price. [25]
Simply Wall St’s December valuation check paints a similarly mixed picture: [26]
- It estimates a “fair value” of about A$18.99 per share, roughly 14% below Fortescue’s recent close of A$21.63 at the time of analysis.
- It notes a consensus analyst target of A$17.50 (with a range of A$15.45–A$20.11), indicating the stock trades meaningfully above both its modelled intrinsic value and the Street average.
Yet on a simple earnings multiple basis, the same analysis points out that:
- Fortescue trades on roughly 13x earnings, while its internal “fair” multiple is closer to ~20x, and the sector average sits above that. [27]
This leads to an unusual split: the “narrative” valuation suggests FMG is somewhat overvalued, but a basic P/E comparison suggests it still looks inexpensive versus peers.
Local research and deep dives
Australian research house Rask Media has also revisited Fortescue in recent weeks:
- On 3 December 2025, it published “Are Fortescue Ltd (ASX:FMG) shares good value in 2025? Here are 6 key metrics you need to consider”, framing FMG as a value case that requires close scrutiny of cash flow, capital intensity and returns. [28]
- On 7 December 2025, Rask followed with “A deep dive into FMG shares”, trailing the question “Is the Fortescue share price undervalued?” and promising three reasons investors might want to consider the stock. [29]
The full reports sit behind Rask’s platform, but their headlines clearly position Fortescue as a candidate for value‑oriented investors willing to look beyond headline earnings volatility and green‑pivot noise.
Longer-term earnings trend: dividends vs shrinking EPS
While the most recent quarter showed healthy margins, Fortescue’s multi‑year earnings trend is less flattering.
Simply Wall St’s November 2025 review highlighted that over the last five years: [30]
- Fortescue’s earnings per share have declined by about 6.5% per year, even as the share price is up ~21% over that period.
- Revenues have slipped about 0.6% annually, underscoring the cyclical and price‑driven nature of the business.
- When dividends are included, total shareholder return (TSR) over five years jumps to around 105%, meaning dividends are doing much of the heavy lifting for long‑term investors.
For the last year alone, Simply Wall St estimates TSR of about 9%, broadly in line with the broader Australian market, again largely thanks to dividends rather than explosive earnings growth. [31]
The takeaway: Fortescue continues to be a powerful income vehicle, but its underlying earnings trend has been drifting down, not up. That disconnect partly explains why several analysts remain cautious despite the strong share price.
Macro backdrop: iron ore demand still central
Fortescue remains deeply tethered to the iron ore cycle.
- In October 2025, Reuters reported that Fortescue’s record Q1 shipments were supported by resilient Chinese demand, even as the country wrestles with property sector stress. [32]
- Elsewhere in Asia, India’s iron ore imports between January and October 2025 hit their highest level in six years, more than doubling year‑on‑year as domestic high‑grade supply fell short, contributing to robust seaborne demand. [33]
Higher‑grade ore remains in particularly strong demand as steelmakers worldwide seek to decarbonise and meet more stringent emissions rules. Fortescue’s strategic push toward green iron technologies with Baowu/TISCO, along with its Iron Bridge magnetite project, is explicitly aimed at positioning the company on the right side of that trend. [34]
Ownership, balance sheet and governance signals
A quick look at Fortescue’s ownership and capital structure helps explain its risk profile:
- Major shareholder Tattarang Pty Ltd, linked to founder Andrew Forrest, holds about 36.7% of the company.
- Hunan Valin Group holds around 8.7%, while BlackRock disclosed a new 5.0% holding in late November 2025. [35]
- No substantial shareholder has reported selling down in the past year, suggesting large, long‑term capital is still comfortable with Fortescue’s direction. [36]
Fortescue has also tapped Chinese lenders for a 14.2 billion yuan (c. US$2 billion) five‑year syndicated loan to support its decarbonisation investments, at a relatively low fixed rate of about 3.8% – a sign that credit markets still view the group as a solid borrower. [37]
The bull and bear narratives in December 2025
Bringing these threads together, the case for and against FMG at today’s price looks something like this:
Bullish themes
- Near‑record shipments and falling unit costs, with FY26 guidance implying continued scale at attractive margins. [38]
- Robust dividend stream, with a long track record of high, fully franked payouts and ~5% trailing yield. [39]
- Strategic pivot towards green iron, batteries and solar, tightly integrated with core iron ore operations rather than scattered hydrogen bets. [40]
- Strong balance sheet and large insider ownership, which can align management with long‑term shareholders. [41]
Bearish themes
- Earnings and revenue have been trending down over multiple years, even as the share price recovers. [42]
- The stock now trades well above most analyst target prices, with consensus implying mid‑teens percentage downside from today’s level. [43]
- Fortescue remains highly exposed to iron ore prices; any sustained slide in Chinese or global steel demand would hit earnings, dividends and potentially the decarbonisation capex budget. [44]
- The writedown of green hydrogen projects shows that not all of Fortescue’s energy transition bets will pay off; further strategy shifts could still carry execution and capital allocation risk. [45]
Key dates and catalysts to watch
Looking ahead into 2026, investors following Fortescue should keep an eye on:
- Next earnings release: current schedules point to late February 2026 for the next major results update, when the writedown on hydrogen projects and updated guidance will be fully reflected. [46]
- Progress on TISCO green iron trial, including any early results from the 5,000‑tonne pilot line. [47]
- Further updates on battery storage deployments and the Pilbara Solar Innovation Hub, which will determine how quickly Fortescue can cut diesel use and Scope 1 & 2 emissions. [48]
- The trajectory of iron ore prices and Chinese steel production, which remain the ultimate swing factors in FMG’s earnings power. [49]
Bottom line
As of 9 December 2025, Fortescue’s share price reflects a lot of optimism: record shipments, lower costs, a credible green‑iron pivot and still‑hefty dividends. At the same time, earnings are lower than a year ago, multi‑year EPS trends are negative, and most formal analyst models sit materially below the current price.
For income‑focused investors who are comfortable with commodity‑cycle risk, Fortescue still looks like one of the ASX’s premier dividend machines. For more conservative or valuation‑driven investors, the mix of high share price, falling earnings and decarbonisation execution risk may justify the caution embedded in current broker forecasts.
References
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