The Fortescue Metals Group Limited (ASX: FMG) share price has been a sensational performer in April among the ASX 50 shares.
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The Fortescue Metals Group Limited (ASX: FMG) share price has been a sensational performer in April among the ASX 50 shares. It’s currently the second-highest gainer this month, following only — you guessed it — Afterpay Ltd (ASX: APT).
At the time of writing, Fortescue shares are up 13.53% in April to $22.70, quadrupling the broader ASX 50’s return after a busy month for the mining giant.
But there’s a little more to the movements than meets the eye. Let’s take a look at the hold-on-to-your-pants month of a Fortescue investor.
Fortescue’s April highs and lows
This month has been no different, and continued hydraulics under the commodity’s value in mid-April once again led to solid gains.
Fortescue often chews up a few more news bites than its rivals, however, largely due to its ambitious climate targets. It wants to be carbon neutral by 2030, which will encompass a huge reduction from the millions of tonnes of greenhouse gas it currently emits every year.
Fortescue chair Andrew Forrest is becoming the spearhead of Australia’s business-led fight against climate change, and the company is taking a proactive approach in shifting towards the production of green hydrogen.
This month alone, Forrest said Australia should become “the Middle East” of hydrogen production, mere days after his company met with the Jordanian government to discuss investment in their hydrogen production facilities. He also called fossil fuels “the most dangerous industry in the world”.
But despite the solid gains, not everything is rosy in term of outlook for the Fortescue share price long-term. UBS has called time on the iron-ore boom (admittedly, prices have kept rising since then).
Moody’s noted that Fortescue’s market capitalisation fell by a whopping 17% between February and March alone, and Goldman Sachs has actively downgraded Fortescue to a sell rating, noting its earnings-per-share is well below BHP and Rio.
Fortescue share price snapshot
It’s also worth noting that the Fortescue share price is the only of the big three miners to have a negative return in 2021 so far, still down 4% despite this month’s gains.
However, those shares have still increased in value by 88% over the past 12 months. That’s beaten the basic materials sector by 47% and the S&P/ASX 200 Index (ASX: XJO) by 60%.
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Motley Fool contributor Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.