The Fortescue Metals Group Limited (ASX: FMG) share price is wobbling today.
It jumped out of the starting blocks from the opening of trade to climb 0.44% to $20.42. However, at the time of writing, Fortescue shares are exchanging hands at $20.22 apiece, a 0.54% fall from yesterday's closing price.
What's been behind the Fortescue Metals share price lately?
Shares in Australia's largest iron ore producer have been on the down lately due to a pullback in iron ore prices.
For instance, the spot iron ore price fell by 3.3% overnight on Tuesday, which resulted in broad weakness across the iron ore miners' basket on the ASX.
Fortescue also reported a 74% year-on-year increase in revenue and grew net profit after tax (NPAT) by 115% to $10.3 billion in its FY21 results.
The company's growth engine is backed by an uptick in global iron ore production that is forecast over the coming years.
Despite these points, the Fortescue Metals share price is down 18% over the last month, to coincide with weakening iron ore markets.
What are brokers saying?
One leading broker, JP Morgan, has reiterated its overweight rating on Fortescue shares, and believes there is still further gains imminent.
As such it has assigned a $29 per share price target for the Fortescue Metals share price. This implies an upside potential of approximately 42% from the current trading price.
Conversely, peer investment bank Goldman Sachs has a sell rating on Fortescue shares, with a $19.90 price target.
What did JP Morgan say about the Fortescue Metals share price?
JP Morgan believes the company "offers exposure to long life operations, with attractive margins and expansion optionality over the long term".
Regarding the company's FY21 results, the broker said "the earnings result and dividend were in line with JP Morgan and consensus. Earnings remained clean and predictable, with a strong EBITDA [earnings before interest, taxes, depreciation, and amortisation] margin of 73%, and enviable balance sheet position of $2.7 billion net cash".
Regarding potential risks to the Fortescue Metals share price, its analysts added: "One of the key overhangs on the stock has been the announcement of a $500-$600 million spend on FFI (Fortescue Future Industries) in FY22. Unfortunately there is still a lack of detail on the breakdown. We have already captured the outflow in our model. However, it remains unclear how to generate a positive valuation on FFI at this stage. There is also no detail on the sequencing of projects on a multiyear look-ahead."
Bringing it all together, JP Morgan's overweight rating indicates it feels this could be a buying opportunity for investors.
Fortescue Metals share price snapshot
The Fortescue Metals share price has had a choppy year to date, posting a loss of around 13% since January 1. Despite this, Fortescue shares have climbed 12% into the green over the last year.
These results have lagged the S&P/ASX 200 index (ASX: XJO)'s return of around 25% over the past year.
