Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
"anyone reckon RIo may follow suit and cut div and either shore up balance sheet or use proceeds to buy distressed assets " Christ, let us hope not. The last thing investors need is for RIO to buy up a lot of lose making dogs and pay for them by increasing debt and/or watering down the stock. I like the way things are going now. RIO is trying to undercut the opposition by price cutting and improved efficiency, which is the best way to improve the share price. Just because it has been done a million times before, having some smart arsed accountant telling you that one egg is really two, is not the way forward.
Good stuff. The CEO Sam Walsh said “Against a challenging market backdrop for the industry, Rio Tinto remains focused on operating and commercial excellence to leverage the low-cost position of our Tier 1 asset base. In 2015, we delivered efficient production, meeting our targets across all of our major products, while rigorously controlling our cost base. We will continue to focus on disciplined management of costs and capital to maximise cash flow generation throughout 2016.” I didn't like the last sentence, which suggests a cut in the dividend, but we will find out in a day or so. As for the rest, Walsh seems a bit of a hard case. I think that I will sit on my shares for a little longer.
"Steel, playing devil's advocate here and looking at the flip side, does that also suggest the overseas majors are gaining further" That makes sense. In times like these the little chap usually gets crushed. Rio's strategy appears to be to produce more for less and pinch their competitors' market share as they do so. It might not be nice, but it could do wonders for the share price.
I don't like to argue with jolly. I am by nature a dour bugger and can see the cloud behind every silver lining. But RIO is a well run company and I expect to make a decent capital gain by late spring/early summer, plus a dividend that will be higher than the interest that I can get from my bank, because any dividend has to be higher than the interest I get from my bank. But keep the bad news coming. I really can't take too much happiness.
There is this one.. [url]http://www.cmegroup.com/trading/metals/ferrous/iron-ore-62pct-fe-cfr-china-tsi-swap-futures.html[/url] It isn't much use, other than to point out that iron futures have dropped about 9 bob for delivery in March, but Iron ore prices, unlike practically everything else, aren't that well documented.
We all invest in our own ways. Rio is a well run company and if anyone is going to go to the wall, it won't be this one. So I have taken another punt now that the shares are selling for washers and hope to make a few bob in late spring, early summer. And if it doesn't, well RIO's share price is like an Essex's girl's knickers. Despite all the evidence to the contrary, sooner or later it has to rise.
"If a positive outcome,maybe a pep up for iron and steel stocks?" Mmh, dunno. If the Chinese stop dumping steel then they won't need to buy so much of Rio's iron ore which can't be good for the SP. All the experts reckon that iron ore prices will stay depressed, so there is a good chance that it will go through the roof. I originally thought that this share would peak at 2900, but my latest sum has it at 3400. So I have stopped doing sums and decided to jump ship at 3000.
This share should hit 1180-1190 within the next 3 months and maybe even 1480 if the profit projection for 2016 holds.But since profit projections never hold, particularly in the building trade, I think that I will jump ship at 1185. Since that is less than 6% from the current price (and closer to 4% when dealing costs are factored in), I reckon this is a good hold but not an overly exciting buy.
Unless we are returning to the 5 bob dollar of my youth, I don't think that the strength of the dollar will make a lot of odds either way. I have made a calculation, which is probably rubbish and largely influenced by the bottle El Dorado 15 Year Old Old Special Reserve Rum that my grandson thoughtfully gave me for Christmas, but I reckon the SP should hit 3412, although not until autumn 2016.
I think you might have a point. Pearson's management team doesn't seem particularly inspiring, but provided there aren't too many profit warnings and the projected profit for 2016 stays above £600 millions, the SP should hit 1200 by about June.
"Looks like Jollyspeculator had the last laugh. well into the teens now." That looks to be the case. I had this share climbing towards the 3000 mark, somewhere between now and May 2016, but that doesn't look to be on the cards. It appears that the Chinese have decided to forswear iron and steel and rebuild the Central Kingdom out of bamboo and panda droppings. Does anyone have any idea when the SP will get off its duff and head for the iplands?
US employment figures for September were pretty disappointing. The markets had hoped for 200,000 new jobs, instead they only got 140,000. Still, maybe the unemployed will stay at home and do a bit of DIY, which won't do AHT's SP any harm.
I reckon the SP should hit 1189, but will probably take 5-6 months to do so.
According to my calculations, which are probably rubbish, but unlikely to be any worse than most of the stuff that appears on the financial pages, the SP should hit 1189, but probably not for another 6-9 months.
That about sums it up. I reckon the SP should hit 1713, although I can't see that happening this side of Christmas. That said, the dividend still beats bank interest, so waiting on the capital gains won't be a hardship.
"What happens to the value of RIO and BHP when the Chinese have their own direct source of Australian supply?" Probably not a lot. Fortescue's profits for 2015 were about a 6th of those for 2014 and 2016 looks to be a quarter of 2015. The Chinese will probably be too busy keeping the company afloat to worry the boards of either RIO or BHP.