The Fortescue Metals Group Limited (ASX: FMG) share price appears to have turned things around this month, gaining 2.5% since the end of September.
Though, that hasn’t been enough to negate the S&P/ASX 200 Index (ASX: XJO) stock’s prior falls. Sadly, the Fortescue share price is still in the year-to-date red.
But, when considering the company’s dividends, would an investor who bought into the stock at the start of the year be recognising a loss? Let’s take a look.
Fall from grace
Assuming I’d invested $1,000 in Fortescue shares on the first trading day of 2022, I probably would have walked away with 50 stocks at $19.85 apiece and $15 to spare.
And that would have been a positive buy for a time. The iron ore giant’s stock reached a high of $22.99 in February, leaving my figurative parcel with a value of $1,150.
But its gains soon turned into losses. The Fortescue share price closed Tuesday’s session at $17.24. That means my initial investment would now be worth $862.
Fortunately, the company has been paying out dividends in that time. Fortescue paid investors an 86 cent per share interim dividend in March and a $1.21 per share final dividend in September.
Thus, after buying 50 Fortescue shares at the start of 2022, I would have received $103.50 in dividends.
That would mean I would be around $20 worse off for the year so far, before considering any potential benefits from franking credits. That’s not too shabby.
Though, a $1,000 investment in BHP Group Ltd (ASX: BHP) shares would have represented a better buy so far.
Are Fortescue shares a buy right now?
Unfortunately, while Fortescue shares have left an investor roughly even this year, brokers aren’t so hopeful on the company’s future.
Morgans is worried about its future free cash flows, saying they could bottom out in seven to eight years’ time, my Fool colleague James reports. That’s because the company is forking out for its renewable energy ventures.
The broker has a reduce rating and a $14.50 price target on Fortescue shares.
Goldman Sachs is also concerned about the impact that the company’s green efforts could have on its bottom line, slapping the stock with a sell rating and a $12.10 price target.
The post If I’d invested $1,000 in Fortescue shares at the start of 2022, here’s how much I’d have now appeared first on The Motley Fool Australia.
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More reading
- What’s the outlook for ASX dividend shares for the rest of 2022?
- Here are the top 10 ASX 200 shares today
- Why Actinogen, Core Lithium, Fortescue, and Galileo Mining shares are pushing higher
- Fortescue share price shrugs off ASX 200 rout to leap higher on Monday
- Morgans names the ASX 200 mining shares to buy and sell
Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. 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 Scott Phillips.
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