GIR.AX submitted their quarterly report today and the market received it very well. They have an excellent suite of projects and today's bounce above $1.30 is a good sign. I think we stay long and see if it can't consolidate above the $1.50 level. They are due to release some more results for their Weld Range resources in the December quarter.
Interesting to note the negotiations that BHP.AX is currently involved with in trying to get rid of the antiquated Iron Ore price negotiations and move it to a traded market like practically everything else. This can only be a good thing for producers and prospective producers as the market is still in under supply. They still seem to have plenty of cash in the bank so things are looking good. I recommend getting on to the ASX website (www.asx.com.au) and having a quick flick through the report.
Happy Punting.
-Rocky.
Wednesday, October 31, 2007
Tuesday, October 30, 2007
China will end in Tears
A recent report on Bloomberg highlighted the fact that of the 10 largest publicly listed companies in the world, 5 of them are Chinese.... Only 3 of them are American. This seems a little out of whack. The Chinese CSI300 Index is up 168% this year! The CSI300 is trading on a forward P/E of 43. While I believe there is a lot of growth to come out of China, a forward PE of 43 seems a little optimistic. If you want to trade the emerging markets story from the long side, I'd recommend having a look at India, whose Sensex Index is up a 'conservative' 48% this year, and only pricing in a forward P/E of 24.4. The interesting thing will be to see if a Chinese correction will cause global equity markets to slow down. It has happened twice this year that China had a decent size drop and on the first occasion (in Feb) markets dropped 3% globally, the second time it happened, no one seemed to notice.
Monday, October 29, 2007
Going for Gold - Chesser Resources
Maurice's boot-of-the-week goes to gold, which is really starting to heat up. If you like it gold, small and risky, here's what I suggest:
Chesser Resources (CHZ.AX) is an undervalued leveraged gold option for investors who believe in the gold story and want to benefit from an uplift in the gold price.
Chesser's flagship asset is the Sisorta gold project in Turkey, where Chesser has the right to earn up to 70%. The project sits in the highly prospective Tethyan Porphyry-Epithermal Belt, which is host to 89 million ounces of gold. Previous drilling has been promising and all indications suggest the project may well host a multi-million ounce gold resource. Based on an average resource multiple of around A$60/oz, this values Chesser's shares at around $2.30 vs their current price of around $0.48.
Considering this, and taking into account Chesser's other exploration assets, a conservative share price target is $1. The time frame on this is likely to be in the medium term and I expect it to start moving when the drilling program starts in a few months and the company starts to promote the project much harder.
Couple with this the rising gold price, which is widely tipped by industry participant's to reach US$1000/oz (up from US$780/oz) and this is one stock that has oodles of upside.
Maurice's Rating (Do It!)
Chesser Resources (CHZ.AX) is an undervalued leveraged gold option for investors who believe in the gold story and want to benefit from an uplift in the gold price.
Chesser's flagship asset is the Sisorta gold project in Turkey, where Chesser has the right to earn up to 70%. The project sits in the highly prospective Tethyan Porphyry-Epithermal Belt, which is host to 89 million ounces of gold. Previous drilling has been promising and all indications suggest the project may well host a multi-million ounce gold resource. Based on an average resource multiple of around A$60/oz, this values Chesser's shares at around $2.30 vs their current price of around $0.48.
Considering this, and taking into account Chesser's other exploration assets, a conservative share price target is $1. The time frame on this is likely to be in the medium term and I expect it to start moving when the drilling program starts in a few months and the company starts to promote the project much harder.
Couple with this the rising gold price, which is widely tipped by industry participant's to reach US$1000/oz (up from US$780/oz) and this is one stock that has oodles of upside.
Maurice's Rating (Do It!)
Stocks to Watch - FND.AX and ESG.AX
Whack these guys on a watchlist. I haven't looked into them fully, but I'm hearing plenty of talk about them and the price action seems to indicate a bit of interest. Finders seems to have run out of sellers, which is never a bad sign. Only issue with this one is finding some stock. Easter Star is another one of those Coal Seam Methane guys that have been so good lately. On a cursory glance they appear to have a good amount of gas and ready market access.
The Week Ahead
Well it should prove to be an interesting week, with the market already fully pricing in a drop in rates from the FOMC on Wednesday. It will be interesting to see what happens, remembering that the market spiked 300 pts North when 'Bad News' Bernanke pulled the trigger on the Fed Put.
What we need to ask ourselves is; "is the US economy really that bad?" I know I've been rubbishing it in recent posts, (mostly as justification for my long AUDUSD position), but should the Fed really be rushing to stimulate the American Economy? The fundamental driver of the big American Machine is consumer spending, which seems to be continuing with the same reckless abandon as always. If I was Bad News, I'd be more worried about inflation as Oil cracks the ton than whether or not a few property flippers in Florida will be able to service their loans. ANyway, it should provide a bit of interesting volatility, which will give traders and investors alike some good entry and exit points in the coming days.
What we need to ask ourselves is; "is the US economy really that bad?" I know I've been rubbishing it in recent posts, (mostly as justification for my long AUDUSD position), but should the Fed really be rushing to stimulate the American Economy? The fundamental driver of the big American Machine is consumer spending, which seems to be continuing with the same reckless abandon as always. If I was Bad News, I'd be more worried about inflation as Oil cracks the ton than whether or not a few property flippers in Florida will be able to service their loans. ANyway, it should provide a bit of interesting volatility, which will give traders and investors alike some good entry and exit points in the coming days.
Friday, October 26, 2007
PXS.AX - 10 Bagger
PXS.AX is cheap. It's a punt, but it's cheap and the numbers make a lot of sense. It's currently trading around $4, and we think it could be $15 by 2010 as it transitions to a mature Pharma company with a suite of products being sold in a range of markets.
here’s why:
- A suite of products with multiple uses in markets where there is a huge need but there are no (or very
few) substitutes
- Importantly these products are either already being marketed and sold or in late stage clinical trials,
significantly de-risking the company
- A strong financial position with ~$125 million in cash
- Scale – PXS has a market cap now close to $800 million which means it will begin to get the attention
of funds and big investors, allowing the company to source the necessary financing needed to bring
its products to market… and has a NASDAQ listing
- A very strong, dedicated and proven management team
- A vision to develop an independent and fully integrated pharmaceutical company meaning
shareholders will reap the long term benefits of PXS success, not an international company
- Potential for a big re-rating as the company moves from a research and development company to a
fully integrated and profitable pharmaceutical company
- Tight share register with a number of substantial institutional shareholders on board
Don't bet the farm, but have some exposure to this stock, it's not often you find an Australian Company that has this much blue Sky Potential, particularly one that isn't leveraged to the commodity bull.
-Rocket.
here’s why:
- A suite of products with multiple uses in markets where there is a huge need but there are no (or very
few) substitutes
- Importantly these products are either already being marketed and sold or in late stage clinical trials,
significantly de-risking the company
- A strong financial position with ~$125 million in cash
- Scale – PXS has a market cap now close to $800 million which means it will begin to get the attention
of funds and big investors, allowing the company to source the necessary financing needed to bring
its products to market… and has a NASDAQ listing
- A very strong, dedicated and proven management team
- A vision to develop an independent and fully integrated pharmaceutical company meaning
shareholders will reap the long term benefits of PXS success, not an international company
- Potential for a big re-rating as the company moves from a research and development company to a
fully integrated and profitable pharmaceutical company
- Tight share register with a number of substantial institutional shareholders on board
Don't bet the farm, but have some exposure to this stock, it's not often you find an Australian Company that has this much blue Sky Potential, particularly one that isn't leveraged to the commodity bull.
-Rocket.
AUDUSD
The AUD popped above 9100, peaking around 9118. Time to take profits and wait for a little consolidation. Another nice 100bps+ profit on a long AUDUSD trade. Also, happy not to hold a position over the weekend. No point paying funding for 2 Days when you can't trade on anything. The trend continues to provide good opportunities on the long side and I'll next be looking at getting long around the 9080 level for a trade to 9150.
Subscribe to:
Posts (Atom)
