Category Archives: $GLEN

Watch your stops on the Miners….EPS Estimates maybe revised lower..

Commodoties go lower breaking support levels – they may continue to go lower if oil prices drop below $40….Watch you stops – there maybe better opportunites to buy lower down
Analysts have not downgraded earnings yet, like they have with the oil companies, but this maybe yet to come if they believe the market is right about the sell off in commodity stocks and commodity prices will go lower.

Fair values below are unchanged, but EPS Estimates have not yet been revised.
BHP BIlliton FV=1850
Anglo American FV=1550
Glencore FV= 340

Vedanta FV=675

2CentView has a trading position in BHP opened at 1400.

2 large cap miners at a 30% discount to FV with good yields – buy one now if you think …

…Commodity prices have bottomed out and the selling is overdone.

With oil prices dragging down other commodity prices and solar stocks on concerns the low oil price indicates a real slow down economic growth, this could be a good time to buy commodity stocks rather than oil companies themselves, whose earning have been revised down in line with current prices – but the commodity and solar stocks have not.

If you believe, the selling is overdone look to buy one of the large cap miners below, for the yield and upside potential:

BHP BIlliton FV=1850 px = 1375 yield = 5.9%
Anglo American FV=1550 px = 1193 yield = 4.5%

other comparables:
Glencore FV= 340 px = 297
Vedanta FV=675 px = 586

2CentView recommendation is BHP – they are making effciency savings to ensure profit margins are maintained (focussing on the bottom line) and the yield is very attractive at nearly 6%.

Trade: Buy here at 1377-1425 region, look for 20% upside i.e take profit target = 1700, stop 1220.
2CentView plans to initiate a trading position in BHP next week.

$IMG and $VED Savaged …

Stopped out $VED at 975. $IMG (imagination tech) continues to get savaged. 2CentView strategy is cut losses on your stops for precisely situations like this and remain well diversified.

$IMG – FV has been dropping since their recent earning announcement. Now FV=150, which implies %14pct growth – PEG 0.75, so quite conservative – but could be further earnings downgrades – waiting for it to hit a bottom – and bounce back.

$VED – FV=850 now. Diversified Metals and Mining ($VED, $GLEN, $AAL, $RIO, $BLT) still trading at overall 20% sector discount, as they have all year – so market as usual is proven right – this was not going to be the year for commodities. Still in $GLEN, where my stop is 260. If next year could be a better year for this sector, then there could be some real bargains to be had. But no rush to buy now.