PEM - Its all over, amazing destruction.

[tricha]

PEM, only 191.3 million shares, 60 cents a pound to produce Zinc, $1 a share in the bank! $201 million cash and recievables!

So the price is really only $4 a share.

Outstanding management!

Three new outstanding projects on the go. Flinders zinc project are going to ship the zinc at the mined level of 30% [:p] That's right 30% zinc ore body!

Take over material as well, no major shareholder except institutions, Westpac 17%, ANZ 15%, National 15% Citicorp 10%

The list goes on.

Their latest Presentation and their annual report are well worth the read.

Cheers [B)][}:)

[leonchai]

Assuming that their forecast 06/07 EPS doubles from 0.36 in 05/06 to 0.72, in line with resource prices, their current PE ratio based on sp of $4.90 is about 7...and a mine life of 6 years pending further upgrades...

when is their Flinders Hill (30% zinc!) project scheduled to start production? will it be soon enough to profit from the current cycle?

I personally feel that it's slightly overpriced now...given that forecast PE for ZFX is about 5 and Minera maybe 7 or 8 (but 30 year mine life)...



Any errors with my above estimate?

[tricha]

Error yes - $1 a share in the bank! $201 million cash and recievables!

So the price is really only $4 a share. Whats the P/E ratio now Leonchai [?]

When is their Flinders Hill (30% zinc!) project scheduled to start production? will it be soon enough to profit from the current cycle? I do not know Leon, but Flinders zinc project are going to ship the zinc at the mined level of 30% So very basic mining operation, dig and put on a ship. 30% is out there!

I see today they make the ASX200 and one of their directors is buying, all good signs.

But you could be right Leon, I might have jumped into it without to much research. But at a rather quick look, looks impressive. Thanks for your view on PEM, all views appreciated!
And yes ZFX will continue to go up.

Cheers [B)][}:)]

[davidrob]

PEM

Agree totally with what you have assessed and written tricha.

One of my faves, and great posts btw Tricha..excellent synopsis and coverage in your last 2 posts.

...many Thanks...great work....

Kindest Regards,

Robbo :)

[tricha]

Was a great day to buy another 4,000 PEM shares today.

This reminds me of May, discounted shares in the market!

Thanks for the take Robbo, whats your views on a takeover, I take it you have a few PEM shares.

Wow, at this price, only really $3.20 a share!

Cheers [B)][}:)]

[stolwyk]

CEO Presentation

http://sa.iguana2.com/cache/8e9a128cdf4357a3ca8a42c288e8a670/ASX-PEM-343969.pdf

Dividend reinvestment plan:

http://sa.iguana2.com/cache/f706ac265b97c529f4e504d3a922535c/ASX-PEM-343986.pdf

[tricha]

Why Peryila is in Zinc Heaven


Dec 26.06 Board Approval for Flinders High Grade Zinc Oxide Project in South Australia




Perilya Limited recently announced that it had gained Board approval to proceed with the development of the 100% owned Beltana zinc mine as the first phase of advancement of its Flinders project in South Australia. The Beltana mine has been approved by the Board based on the favorable returns generated by the mining and direct shipment of 150,000 tons of high grade zinc ore.

The feasibility study recently completed shows the Beltana project has a pre-tax net cashflow of $50.6 million (assuming an average US$1.25/lb zinc price and US$0.78 exchange rate) with an IRR of 84 per cent. At the prevailing zinc price of US$2.00/lb, the project would be expected to generate pre-tax net cash flows in excess of $130 million.
Chief Executive Officer, Len Jubber, stated that the Beltana mine provides Perilya with a low cost entry into a significant zinc oxide resource at historically high spot prices.

The high grade tenor of the project and the tightness of the zinc market at present provides Perilya with the opportunity of identifying a market for an additional 242,000 tons of lower grade material that is contained within the existing mine design. All of this material, grading between 14 and 26% zinc, will be stockpiled separately on site. Investigation into the beneficiation of the lower grade material through ore sorting or other means has commenced.

The Flinders project is located 470 kilometers north of Adelaide in South Australia covering 4,138 square kilometers and comprises several high-grade zinc oxide prospects in close proximity to Leigh Creek, a well established mining community. The total Mineral Resources for the Flinders project is currently estimated at 966,000 tons at 31% zinc containing almost 300,000 tons of zinc metal.

Development of the Beltana mine will comprise a 12 month open cut mining and on-site crushing program which, subject to regulatory approvals, is expected to commence in the second quarter of 2007. Most of the project infrastructure is already in place and the project development will be funded internally.

The project will involve direct shipment of high grade zinc oxide ore through Port Pirie to smelters in Asia. The first ore shipment is expected early in 2008 with sales continuing over a two to three year period thereafter. Contained zinc sales for 2008 financial year are forecast at 15,000 tons increasing to 20,000 tons in subsequent years.

“The Beltana mine entails extending the existing 65 meter deep pit a further 30 meters providing a short lead time and low capital cost route to approximately 57,400 tons of contained zinc and will enable us to take further advantage of the prevailing high zinc prices,” said Mr Jubber.

“The commercialization of the Flinders project will provide significant additional value to our shareholders” said Mr. Jubber.

[Jaffa101]

Tricha
You will be very happy with todays performance! Also - thanks for bringing this share to my attention about two months ago. I always enjoy your colourful postings on this site!
Have a good New Years in WA!
Cheers

[tricha]

Thanks for your comments Jaffa, yes she a great company, even though it has increased so fast, it is still relatively undervalued, big + is under 200 million shares.

Great things coming with the Zinc price above $1.50 ilb.

Cheers [B)][}:)] and all the best for 2007.

[tricha]

Pretty good quarter announced and excellently presented [:p]

238 million now in the bank.

Quality new projects in play.

Significant upside if the boom continues.

Oh and a very positive thing, they do not have the gold bug, hence trying to get rid of Daisy Malay.

Cheers [B)][}:)]

[tricha]

Took the punt today, I'm waiting for the rebound.

A ten % drop in share price, talk about skitzo.But really what has changed, iron ore production in China up 13.5 % last year, to me it equals a 13.5 % increase in the amount of Zinc required.

So topped up another 5,000 shares with the profit from Mincor.

With $1.19 cash a share in the bank, they are really only cost $3.41 cents a share, pretty cheap really I think.

Flinders project, 38% Zinc, dump it on a train and off to China, how cheap and easy is that [?][?]

Sink or Swim, Cheers [B)][}:)]

[SEC]

quote:Originally posted by tricha

A ten % drop in share price, talk about skitzo.


Until today, PEM was defying gravity when the other zincos have been taking a hit over the past month. I expect it to correct in line with the others in due course.

SEC

[tricha]

Great result out today, gravity effect over![8]

Going off, to the moon ;)

Profit after tax up 349% to 76.142 million and earnings per share after tax is 39.8 cents for only 6 monthes.

Perilya is a premium Zinc producer with a lot more to come!

Cheers [B)][}:)]

[Halba]

this co has performed nicely. Its probably has the best cash flow to mkt cap ratio on the ASX 200

[tricha]

Halba - u r on to it, cheap as chips, P.E Ratio of 5.1

My target price would have to be $7.00 for around 7 P.E on around $1.50 ilb zinc price.

That's not including the upside.

Three new outstanding projects on the go. Flinders zinc project are going to ship the zinc at the mined level of 30% That's right 30% zinc ore body!

Take over material as well, no major shareholder except institutions.

Cheers [B)][}:)]

[Halba]

just cheap
very cheap on all multiples

they continue to replace their reserves

[absolut-advance]

Excellent investment going forward IMO

AA

[tricha]

The History

Like the mining industry in Australia, Perilya Limited shares a rich and proud history of determination, persistence and adaptability. Its past is etched with character-building challenges, stunning successes and most importantly, the wisdom to seize opportunities to refocus and launch forwards in this new and exciting era of Australia’s resource development.

Perilya was established in 1987. Through a diligent approach to identifying undervalued assets, it has assembled a diverse portfolio of quality base and precious metal operations and exploration projects.

The foundation for the company’s rapid growth came with the purchase of the Fortnum gold mine in Western Australia in 1994.

When acquired, Fortnum had ore reserves of 55,000 ounces. Over the next six years, Perilya produced 540,000 ounces of gold from the mine. This operational success generated an operating surplus of more than $70 million up to mine closure in August 2001.

In anticipation of the closure of the Fortnum Gold Mine, Perilya embarked on an aggressive evaluation and acquisition program. Broken Hill was identified as an operation that could provide Perilya with significant and sustainable cash flows with which to further grow the company.

In May 2002 the company successfully acquired the Broken Hill mine, one of the largest and most renowned zinc, lead and silver mines in the world.

The Broken Hill mine has produced over 200 million tonnes of ore in its 120 years of mining history, dating back to 1885. The purchase of Broken Hill, from Pasminco Limited, gave Perilya a unique opportunity to further its success and achieve its objective of growing into a major mining company.

Perilya has increased production at Broken Hill to the current rate of around two million tonnes per year and in the 2005/06 year produced 144,100 tonnes of zinc and 74,800 tonnes of lead.

The Company has brought a new vitality to one of Australia's premier mining operations which has the potential to provide significant cash flows to sustain the company’s other exploration, development and investment activities.

In January 2005, Perilya acquired the Daisy Milano gold mine, southeast of Kalgoorlie, which produced 27,298 ounces of gold in its first full year of operation in 2005/06.

Perilya's exploration interests include projects throughout Australia and in the state of Sabah in Malaysia.

[tricha]

The Board - Outstanding quality!

“Our strategic focus is to position Perilya for sustainable growth. The ongoing strength in our commodities, rapid advances in new project developments, growing organisational capability and strong cash flow from operations auger well for the future of the company.” Patrick O’Connor - Chairman

board of directors
Patrick O'Connor
BCom, SEP Stanford (USA) FAICD Chairman and Independent Non-Executive Director

Patrick O’Connor (43) was appointed Chairman on 1 February 2006. He is Chairman of the Remuneration Committee and a member of the Audit and Risk Management and Health Safety and Environment (HS&E) Committees.

He was previously the Managing Director of Churchill Capital, a boutique investing and consulting group and until recently a Non-Executive Director of Oceana Gold Limited.

Patrick is a fellow of the Australian Institute of Directors and attended the Stanford Executive Program at Stanford University, California, USA. He was the founder and Managing Director of Macraes Mining Company Limited from 1989 to 1998.

Patrick is currently one of the founders and executives of St George Capital Pty Ltd, a boutique investment manager; and an executive of SG Growth Equities Limited.

Current Directorships
Chairman: Xceed Biotechnology Limited
Executive Chairman: SG Growth Equities Limited
Director: Adelphi Energy Limited
Director: Water Corporation of Western Australia

Former Directorships over the past three years
Director: Oceana Gold Limited
Chairman: Acuron Limited




Len Jubber
B Civil Eng, MBA
Managing Director & CEO

Len Jubber (46) was appointed Chief Executive Officer on 16 May 2005. Len is an engineer with a post graduate degree in business administration and more than 16 years experience in the minerals industry. He spent seven years with Oceana Gold Limited, ultimately becoming the Chief Operating Officer and an Executive Director.

Prior to Oceana Gold, Len spent eight years in Southern Africa with Rossing Uranium Limited, a subsidiary of Rio Tinto.

Current Directorships
Southstar Diamonds Limited

Former Directorships over the past three years
Oceana Gold Limited

Phillip Lockyer
AWASM, DipMETALL, M.SC
Independent Non-Executive Director

Phillip Lockyer (62) was appointed Non-Executive Director on 19 November 2003 and was the company’s Chairman until 1 February 2006. Phillip is Chairman of the HS&E Committee and a member of both the Audit and Risk Management Committee and the Remuneration Committee.

Phillip is a mining engineer and metallurgist with more than 40 years experience in the minerals industry with an emphasis on gold and nickel, in both underground and open pit mining operations.

Phillip was employed by WMC Resources for 20 years reaching the position of General Manager for WA, responsible for that company's nickel division and gold operations. Later, Phillip held the position of Director of Operations for Dominion Mining Ltd and Resolute Ltd.

Current Directorships
Director: Jubilee Mines NL
Director: Ammtec Limited
Director: Focus Minerals Limited
Director: MERIWA

Former Directorships over the past three years
Nil


Guy Travis
AWASM, MSc, DIC
Independent Non-Executive Director

Guy Travis (64) was appointed Non-Executive Director on 5 October 2002.

A geologist by profession, Guy spent his first 18 years in the industry with Western Mining Corporation before forming a geological consulting and contracting company Aurex Pty Ltd. He was Managing Director of Ranger Minerals Ltd from its incorporation in 1984 to its merger with Perilya in October 2002.

Current Directorships
Director: Southstar Diamonds Limited

Former Directorships over the past three years
Nil



Peter Harley
BComm, FCPA, FAICD
Independent Non-Executive Director

Peter Harley (56) was appointed Non-Executive Director on 19 November 2003

[SEC]

Perilya has thrown in the towel on their Dog Milano gold mine on the guise that they're preparing it for divestment. Yeah right, they've struggled to make any decent money from this mine since its purchase and will probably get only peanuts for it. At least they've made the tough call on suspending operations and are able to move valuable resources elsewhere. Probably the correct decision but the market may not like it short term. PEM is higher up on my watchlist now.

SEC

[tricha]

Sec "At least they've made the tough call on suspending operations and are able to move valuable resources elsewhere"

A very clever move by the board, get rid of the dog and focus on the quality!( gold suks)

PEM absolutely dirt cheap and why I bought more.

$3.84 a share - $1.30 per share cash in the bank = equals intrinsic value of only $2.54 a share.

Broken Hill will continue to outpreform for them and lots more to come.

I can not believe someone has not made a play for them yet, especially at these incredibily low prices. Profit after tax up 349% to 76.142 million and earnings per share after tax is 39.8 cents for only 6 monthes.for a $2.54 is a no brainer.

Cheers [B)][}:)]

[duncan macgregor]

TRICHA, You sold MCR which was in an uptrend to buy into PEM which is still on a downtrend. That was a mistake. The time to buy PEM is when it starts to uptrend as I told you at the time. Never sell a good uptrending share, and never ever buy into a downtrend regardless of how right you feel. Its much better to miss out on a few cents at the top and bottom, rather than bottom pick. I selected PEM in the competition which has turned into a complete dog since then, so i got it wrong as well. I would not hold PEM at this moment in time until it turns the corner. MACDUNK

[tricha]

Duncan I thought it would be prudent of me to diversify a little.

Mincor were 70% of my portfolio. Would you hold 70% of your assets in one company [?][?][?]

Also I do not follow charts, chartist are for people who live in the clouds[:o)] I tend to buy on quality and I rate PEM as outstanding quality in all aspects (management, assets, etc)

And I rate it as my #1 take over contender, no major player in here except institutions.

Cheers [B)][}:)]

P.S I bought most of my Mincor when they were right in the middle of a down trend @ .65 cents.

[duncan macgregor]

TRICHA, I have half my portfolio invested in SMM. I have the other half in equal ammounts in MCR, AGM SMY,IGO. If i have you on about what you do then you should know what I am up to, to keep things fair. SMM i bought at mostly In Dec 2006 and Jan 2007. I topped up with a large ammount at av $4-15 later. My stop losses are all well above purchase prices. I feel sure that PEM will be a winner, the only thing you did wrong was buy into a downtrend. That was why i told you it was a bad move, it was not your company choice that was wrong, it was market sentiment at that time. macdunk

[tricha]

Duncan - "I feel sure that PEM will be a winner, the only thing you did wrong was buy into a downtrend. That was why i told you it was a bad move, it was not your company choice that was wrong, it was market sentiment at that time. macdunk"

I have to say I strongly disagree with your investment strategy Duncan.

Perilya meets my critera as a value stock and the market price is not reflecting its value. It does not matter if it has not bottomed, its results will speak for itself.

http://sa.iguana2.com/cache/d01e6be864dea607d837a9d861501ecf/ASX-PEM-353973.pdf

Extract from presentation to Euroz conference.

North Deeps Mine = 4.2mt @ 11.2% Zinc, 13.7% lead and 214 g\t Silver.
The silver content alone at todays price is worth $3,500 a ton OZ.

And thats only a little part of the story.

The company and management ooze quality and Broken Hill is a gem of a mine.

Cheers [B)][}:)]

[duncan macgregor]

It is much easier swimming with the tide. Your impatience Has you jumping in to soon, and going backwards. Its got nothing to do with what you think its worth, its MR MARKET that decides. When you see that he has switched on to the fundamental facts, then and only then do you jump in. Your starting position is going backwards you should not be in the race. macdunk

[soulman]

Not sure about jumping on board on a mid tier miner with big cash flow potential.

PEM has fallin everyday and I am just waiting for the signal to get the lowest price possible.

[duncan macgregor]

How low will this go before it turns round. I never thought for one moment it would descend to the depths that it is at right now. I nearly bought into it at the start of the year, how wrong can you get?. Anyone know the real reason for this downtrend with predictions of where it might bottom out. macdunk

[Huang Chung]

Yeah Macdunk, its dropping like a stone at the moment. Does make you wonder in these situations whether there is a bargin to be had, or if someone knows something the rest of us don't know [?][?].

All I know is that I don't know......

[tricha]

Well broke your rule again Duncan,my rules are different, bought another 10,000 today at $3.55, some super fund dumping.

The only way I will come unstuck is if Zinc collapses, which you never know. At the end of this quarter they will probably have close to 300 million cash in the bank including recievables)

Which would mean all their assets excluding cash would be valued at only 400 million, dirt cheap.

Interesting to see someone pigged into them late in trading and hopefully this will have taken out the dumper, expect to see an announcement soon "change in substantial holder"

Could this be the start of a takeover or just another fund manager buying cheap [?][?][?]Remember PEM has no major shareholder except superfunds.

Cheers [B)][}:)]

[duncan macgregor]

The trouble is stop losses crashing out everywhere. SH*T happens its not required to make sense. Its better to lose a few cents at the bottom than losing heaps all the way down. It might be a good lesson to take on board next time you buy into a downtrend. The market runs to far in opposite directions some times, to understand that is the secret of beating the market. The only problem you have TRICHA is you are way behind the starting price with playing catch up. The downtrend is still going you are averaging down. macdunk

[Dazza]

sec

whats this about their gold???

i thought they not doing gold? well at least mining it for now anyhow

milano mine? when did they close that or mined it etc.

i cant see from recent announcements about it eh.


isnt CBH mining in broken hill as well?

i currently have somce cash that im waiting to park some funds into zinc

was tinking of doubling my exposure to ZFX...

though because PEM has been hammered lately.. i am tempted to buy PEM instead..

[Dazza]

nvm i found the announcement, it was in early march

though the downfall was since beg jan..

im wondering or if tricha knows

how much profit does the gold represent?

[tricha]

Dazza - "though the downfall was since beg jan.." - its following the Zinc price down Dazza, just like most Zinc miners.
At the moment super funds are dumping it relentlessly and I can relate it to MCR when AMP dumped and dumped and dumped them, hence a lot of us make heaps from AMP dumping[:p]



Dazza - "how much profit does the gold represent?" No profit, most Aussie gold miners suk, hence Perilya's astute management are getting rid of the dog!

[John Galt]

I'm surprised ur so keen to buy in tricha, zincs not exactly collapsing but there are other metals out there doing much better. Nickel for eg.

I'm interested in this coy, and agree that it looks good fundamentally but will only buy in when zinc starts trending upwards.

http://charts.infomine.com/?11

http://charts.infomine.com/?9

[tricha]

Well John, the way I see it Perilya = Quality

And I have to diversify a little, I have been trying to find the best Nickel play, Zinc play , Oil play and Gold play and then there are my gambling or speculative stocks!
Just about given up on the gold one, Stowlyk hit the nail on the head, there are few great Aussie gold companies, overseas is far better, e.g TSX

As posted recently,a must read.

http://sa.iguana2.com/cache/d01e6be864dea607d837a9d861501ecf/ASX-PEM-353973.pdf

Extract from presentation to Euroz conference.


Perilya meets my critera as a value stock and the market price is not reflecting its value. It does not matter if it has not bottomed, its results will speak for itself.


North Deeps Mine = 4.2mt @ 11.2% Zinc, 13.7% lead and 214 g\t Silver.
The silver content alone at todays price is worth $3,500 a ton OZ.
And thats only a little part of the story.

The company and management ooze quality and Broken Hill is a gem of a mine. and they got it for a steal, off Zinifex. [:o)]

Cheers [B)][}:)]

[Dazza]

if with regards to Zinc price

then yes PEM/KZL are all down about 33% from highs

where as ZFX, only down 15% or so

:D

[stolwyk]

http://www.metalprices.com/FreeSite/metals/zn/zn.asp#Tables

[tricha]

Did you push the button Dazza [?][?], PEM or ZFX both quality.

With copper going off again ( Copper is a key indicator to the world market situation, copper follows business growth) we should see a upside in the Zinc price very soon.

Perilya's Beltana starts up
(Thursday, 22 March 2007)

PERILYA has started mining its Beltana zinc project ahead of schedule and under-budget, which will enable the diversified miner to take advantage of a higher zinc price and could have potential upside from the marketing of its intermediate-grade zinc material.

[Dazza]

no unfortunately i didnt buy any.

LME stock levels of zinc seem to be rising , at least 2k a day..

so im gettinga bit worried.

so just leaving my zinc exposure as of that

though mind u its only about 25% stock from its high of 400k tonnes

so still a shortge indeed

[duncan macgregor]

quote:Originally posted by tricha

Took the punt today, I'm waiting for the rebound.

A ten % drop in share price, talk about skitzo.But really what has changed, iron ore production in China up 13.5 % last year, to me it equals a 13.5 % increase in the amount of Zinc required.

So topped up another 5,000 shares with the profit from Mincor.

With $1.19 cash a share in the bank, they are really only cost $3.41 cents a share, pretty cheap really I think.

Flinders project, 38% Zinc, dump it on a train and off to China, how cheap and easy is that [?][?]

Sink or Swim, Cheers [B)][}:)]

TRICHA, This is a good lesson to be learned for all of us when we look at your optimistic bottom picking punt. Regardless of what we think a share is worth we first of all must take into account what MR MARKET is doing. PEM bottomed about $4-25 did a dead cat bounce and is now $3-68 or over 13pc down since you bought into the downtrend. At that time MCR were $2-75 now $3-15 or 14.5 pc up so that in actual fact by not obeying the rules you are nearly 28pc down. Your only mistake was selling an uptrending stock, and buying a downtrending stock, which is the ultimate mistake. I feel sure your PEM stock will come right in the end, but the time to buy is after the uptrend is confirmed. Its better to miss a few cents at the bottom to have the uptrend confirmed than jump in to soon. macdunk

[tricha]

You are right Duncan, I got Perilya wrong, not because of some fairy trend, but because I miss read Perilya's announcemnts and assumed ( assumption is the m of all f...u.s)

Assumed after their tragic accident they would be back in full production after a few days as is the norm in a mining accident.

Unlike you Duncan I do not follow trends, I try and follow Warren Buffets principal "value investing" most of the time, a few speculative plays along the way.

Perilya is an outstanding company, however their earning for this quarter are going to be low, it might have something to do with their share price being down.

But give it a bit of time and they will be on their way again, if the zinc price stays at $1.40+

Cheers [B)][}:)]

P.S The lession for me here to to read annoucements properly!

[duncan macgregor]

TRICHA, No worries PEM will come right in time. The time will be easy to spot. MR MARKET will tell you when it is a buy. Downtrends fall further than common sense dictates. It also rises higher sometimes, Mr MARKET has very little between his ears when it comes to practicality, learn the simple rules to beat him, he is the one that decides a shares worth not you. macdunk

[Skol]

Might have liftoff on this one finally. Been picking up a few, seems too good to be true.
Up about 25c in the last couple of days.
P/E about 6 and a mining stock that actually pays a dividend. Not much debt and chart looks very good. Zinc price on the way north helps a bit too.

[tricha]

Not much debt Skol - 230 million sitting in the Bank! [:p]

Yep cheap as chips and yes Skol if the zinc price gets moving North.

A fantastic opportunity, this quarter will disappoint, but onwards and upwarda after that.

Cheers [B)][}:)]

[Skol]

Hey tricha,
For what its worth if you look on the MND thread you'll see that I predicted MND would break out. It did 3 days later.
The same pattern if anything, more convincing, has shown up for PEM and with increasing volume.
Based on this pattern I bought some PEM in the last 2 weeks. I know a lot of guys think TA is crap and I'm not entirely convinced myself but let's see. Should do OK in the next few days. I'm ahead already.

PS Zinc price up $200 in the last couple of days which helps.

[duncan macgregor]

quote:Originally posted by Skol

Hey tricha,
For what its worth if you look on the MND thread you'll see that I predicted MND would break out. It did 3 days later.
The same pattern if anything, more convincing, has shown up for PEM and with increasing volume.
Based on this pattern I bought some PEM in the last 2 weeks. I know a lot of guys think TA is crap and I'm not entirely convinced myself but let's see. Should do OK in the next few days. I'm ahead already.

PS Zinc price up $200 in the last couple of days which helps.


TA is not crap it only shows what the investors are doing, and what they are likely to do. If you think that insiders get to know what is likely to happen before you do, then TA will pick that up. We have a classic example on this thread of someone selling out of an uptrend to buy in a downtrend only to find regardless of how much you think or might know, its the market that decides. PE ratioes, money in the bank, future prospects will decide long term what the company sp will get up, to but TA tells you what to do today. If you want to buy to high, or allow your profits to turn into losses, then stick to fundamental analysis but dont say TA is crap because you fail to understand it. Macdunk

[tricha]

Skol - "PS Zinc price up $200 in the last couple of days which helps."

Good on U Skol for getting into a quality company and I think this is the major factor in its price going back up ( reminds me of copper and nickel recently ;))

Zinc April 11,06:11
Bid/Ask 1.6202 - 1.6248
Change +0.0272 +1.71%
Low/High 1.5885 - 1.6611
Charts

[salsanova]

hi guys ,good to hear the great debate is still raging .i use three technic's for aussie stocks .recently purchased a scanner package which gives a buy in on a relavant historical finger print based on cma ,rsi,macd values relating to the highest profitable trades over a period of months or years .got on to this stock pem 2 weeks ago aprox .this is how it works
scan the market ,this uses the latest values ,check the profitablity of the stock at this value eg;rsi 8 (this isn't the one used for this stock)i usually only pick trades turning over a million dollars on a day with a 75% to 100% winning trades go to chart check technical analysis then i do a little reserch on the company and its fundimentals if i think this adds up to what i would buy ,i buy it set a stop ,a profit stop ,plus the current value, in this case rsi 8 and wait for it to tell me when to sell, easy and its seem to be working extremely well . i must point out i have only been using this proceedure for 6 weeks but have had a portfolio increase of 25% better than i have done ever before in the time frame ( this is not a garantee but the company told me 10% a month is not out of the question)so far this stock looks impressive with a ceiling of around $5 plus go pem.
anyone interested in hearing more about this program email seajet1@optusnet.com.au

[wns]

I bought some of these today.

[steve fleming]

PEM released their awful 3rd quarter results on 18 April 2007.

Over the next couple of days each of the following Brokers updated their respective Target Price and rating on PEM to BUY/OUTPERFORM as follows:

Paterson Sec - $4.63
ABN Amro - $4.45
UBS Warburg - $5.35
Macquarie - $4.80

They must be of the opinion that all bad news is now out, and PEM can now move forward positively, as it was prior to the accident.

[tricha]

Steve -"They must be of the opinion that all bad news is now out, and PEM can now move forward positively, as it was prior to the accident."

Positively high quality and the sooner they go to a multi mine operator and diversified the better, the brokers are about a $1 short of fair value;)

BASE METALS
WORLD 12TH LARGEST PRODUCER
Zinc miner Perilya looks deeper and beyond Broken Hill
Australiam mid-tier miner, Perilya, already one of the world’s more important zinc producers, is opening a new mine and boosting its exploration activities.

Author: Ross Louthean
Posted: Monday , 30 Apr 2007

ADELAIDE -

One of Australia's high flying mid tier miners Perilya Ltd (ASX: PEM) will be using its growing coffers to more aggressively explore and develop in the Broken Hill region, bring on a new mine in South Australia, lift its search spend elsewhere and consider mergers and acquisitions opportunities, particularly in Australia.

Perilya's chief executive Len Jubber outlined progress and plans at the Paydirt's South Australian Resources & Energy Investment Conference in Adelaide today, and said the company now has $A150 million in cash.

Its strong cash flow from the Broken Hill operations acquired from the asset sales of stressed Pasminco Ltd (later rebuilt as Zinifex Ltd) six years ago should see growth from improved performance there and also from the low capital cost bonanza-zinc Beltana project in South Australia's Flinders Range.

Jubber said that the priority for the early operating years was to pay off the 66% balance owed for the purchase of the Broken Hill mines and infrastructure.

If all the advanced exploration, advanced development and feasibility studies come together then Perilya could within three to five years lift its annual production to about 200,000t of contained zinc. Perilya is already ranked as the 12th largest zinc producer in the world.

He described the situation on slow exploration until now on many good properties to have been embarrassing, but the company was now clear of debt to march forward.

There were now four drill rigs operating in the Broken Hill region and one of the promising regional properties was Henry George (A best recent hole was 8 metres from 105m depth grading 11.3% zinc, 2.5% lead and 40 grams/tonne silver).

The Beltana open cut as the first stage of Perilya's Flinders project has reached the stage where it is down to 70m and this relatively small mine will be developed a further 30m to take out 376,000 tonnes grading 32.6% Zn, of which a large section grades 40%.

It is willamite ore and challenges some conventional smelters and refineries. Jubber told Mineweb that the Flinders project is near the Leigh Creek coalfield so it is close to the railway down to Port Pirie. Beltana ore could be sent to Thailand or China where some Beltana ore from a previous owner has been processed. Beltana could provide Perilya with an internal rate of return of 88%. That IRR could lift to 100% if the low grade (10-20% zinc ore) could be treated by a hydrometallurgical or some other process - an issue being discussed with several parties.

Developments detailed to the conference were:

The Potosi decline mine, 3 kilometres from the company's North mine at Broken Hill, will hit ore in the September quarter and is set to provide 200,000 tonnes per annum to the Broken Hill concentrator.
A $5 M feasibility study is advancing on re-opening the North Deeps (including the Fitzpatrick zone) which was shut during flat metal prices back in 1993 and should be completed in the next nine months. This, if found viable, would access major reserves including zones grading up to 25% Zn. Jubber told Mineweb an added advantage from this exercise is that the dewatering will help resolve drought-hit region's shortage of water.
The second stage of the Flinders project could take in development of the Reliance deposit (355,000t @ 29.5% Zn) and other dis

[wns]

quote:Originally posted by steve fleming

PEM released their awful 3rd quarter results on 18 April 2007.

Over the next couple of days each of the following Brokers updated their respective Target Price and rating on PEM to BUY/OUTPERFORM as follows:

Paterson Sec - $4.63
ABN Amro - $4.45
UBS Warburg - $5.35
Macquarie - $4.80

They must be of the opinion that all bad news is now out, and PEM can now move forward positively, as it was prior to the accident.


Been some nice little rises in the sp in the last couple of days, closing at $4.50.
I wouldn't be surprised if its $6.00+ in the next 6 months or so.

Looks undervalued to me, and had reached $5.80 before the accident.

[tricha]

WNS -"Been some nice little rises in the sp in the last couple of days, closing at $4.50.
I wouldn't be surprised if its $6.00+ in the next 6 months or so.

Looks undervalued to me, and had reached $5.80 before the accident."

Well AXA seem to like it and they have every reason to.

I'm still waiting for a take over offer [?]

Cheers [B)][}:)]

[duncan macgregor]

quote:Originally posted by duncan macgregor


quote:Originally posted by tricha

Took the punt today, I'm waiting for the rebound.

A ten % drop in share price, talk about skitzo.But really what has changed, iron ore production in China up 13.5 % last year, to me it equals a 13.5 % increase in the amount of Zinc required.

So topped up another 5,000 shares with the profit from Mincor.

With $1.19 cash a share in the bank, they are really only cost $3.41 cents a share, pretty cheap really I think.

Flinders project, 38% Zinc, dump it on a train and off to China, how cheap and easy is that [?][?]

Sink or Swim, Cheers [B)][}:)]

TRICHA, This is a good lesson to be learned for all of us when we look at your optimistic bottom picking punt. Regardless of what we think a share is worth we first of all must take into account what MR MARKET is doing. PEM bottomed about $4-25 did a dead cat bounce and is now $3-68 or over 13pc down since you bought into the downtrend. At that time MCR were $2-75 now $3-15 or 14.5 pc up so that in actual fact by not obeying the rules you are nearly 28pc down. Your only mistake was selling an uptrending stock, and buying a downtrending stock, which is the ultimate mistake. I feel sure your PEM stock will come right in the end, but the time to buy is after the uptrend is confirmed. Its better to miss a few cents at the bottom to have the uptrend confirmed than jump in to soon. macdunk
Even although it will all come right in the end, look at the money you might have made with a decent buy and sell system. Buying into a downtrend cost you a lot of time, and money playing catch up later on. Selling a steep trending share before it topped, cost you lots of opportunity dollars. The number of companies in your portfolio counts for nothing as far as risk goes. It is much easier to get out of six companies as it is to with sixteen. I had half the value of my portfolio on SMM, sold out at $5-94 as stated on these forums, with little or no risk involved. I still hold MCR its still on an uptrend, the market will let me know when its time to dump it.
Risk is what you take with an initial buy before the share gets into profit. When the share is in profit, and your stop loss is higher than your initial buy, the risk is gone. At that point the percentage of your portfolio on that one company should be high, to getting higher with sales from your lower trending shares.
By adding to your best performers with money from your worst your portfolio will outperform someone jumping in and out all over the place. Macdunk

[Brut]

Macdunk, slightly off the subject but are you still holding AGM ( closing yesterday @ 82c down from its recent high of $1.18) this is down almost 30%

Just wondering if you are still holding this stock & if you follow your own rules that you advise everyone else to sell when "Mr Market" is telling you to sell?

I'm not knocking AGM as I think it's a good company & looking for a new entry point but it has been on a down trend for awhile now...

Cheers

[duncan macgregor]

BRUT, Sold AGM in my trader account with a 10% stop loss triggered got out a bit late about $1-05 average. Investor account still hold MCR, IGO, AGM, I Bought in at 59c its now down to 81c which is 37% up in six months. I did expect volatility with a company that is not into production and did expect the sp to get to high and to low. This is a company i expect to make a big play on very shortly with my trading account in about a months time. I start with very tight stop losses up to the point where my stop loss is well above my buy in price then inclined to let them run until the band stops playing.
Trading is more fun, and much more profitable, investing requires you to not overdo your buying and selling regardless of what your system dictates. If in doubt i get out. macdunk

[Brut]

Thanks Macdunk, I appreciate your honesty:)

Cheers, have a good day!

[steve fleming]

quote:Originally posted by tricha

WNS -"Been some nice little rises in the sp in the last couple of days, closing at $4.50.
I wouldn't be surprised if its $6.00+ in the next 6 months or so.

Looks undervalued to me, and had reached $5.80 before the accident."

Well AXA seem to like it and they have every reason to.

I'm still waiting for a take over offer [?]

Cheers [B)][}:)]


Tricha

try and dig up some info on the privately held, recently re-opened historic Pinnacles lead/zinc mine at Broken Hill, next door to PEM....if PEM can do a deal with Pinnacles (i.e. very similar to the MCR/McMahon-Durkin deal) it will be absolutely outstanding.

PEM keeping talking up their possible M&A activities - heaps more value doing it with a private co such as Pinnacles than a public co....anyway if i was advising PEM, thats definitely what i'd be recommending.

http://au.biz.yahoo.com/070404/31/16ds1.html

[tricha]

Hi Steve, thanks for this very interesting information.

ABC Finance News

New lease on life predicted for Broken Hill, Wednesday April 4, 2007, 1:42 pm

Another major mining development for far west New South Wales has been forecast with discoveries at the Pinnacles Mine, 15 kilometres west of Broken Hill.

The managing director, Craig Williams, says an open cut operation known as the Edwards Pit is under way, and an adjoining discovery called Perseverance has high-grade silver, lead and zinc as well as copper and gold.

He says another four high potential deposits have been found.

Mr Williams says the discoveries are the result of continued drilling, and are far greater than he expected.

"At this stage it's anticipated to reach 600 million tonnes - silver, lead and zinc," he said.

"It's very hard to determine the value of the product in the ground but that's always moving with metal prices.

"But if the mining plan goes ahead full swing, it will be a major development for Broken Hill and I can foresee between 400 and 500 employees."

[steve fleming]

Some pretty large broker upgrades have come in the last couple of days on PEM.

Should hold $5 and push on leading up to reporting season...as analysts attention focuses on 08 rather than 07.

Acquisition announcement should'nt be too far away either.

[tricha]

Its out there Steve, forward 2008 PE of 5.

With Zinc due to go off [:p]

PEM is cheap! To think a few monthes ago I was buying it at $3.50 and Duncan told me I was mad buying a quality company in a down trend :(

Cheers [B)][}:)]

[duncan macgregor]

quote:Originally posted by tricha

Its out there Steve, forward 2008 PE of 5.

With Zinc due to go off [:p]

PEM is cheap! To think a few monthes ago I was buying it at $3.50 and Duncan told me I was mad buying a quality company in a down trend :(

Cheers [B)][}:)]
Tricha, not trying to prove you wrong, or me right, but now with the benefit of hindesight, lets see if you got it right in the end or me wrong. Going by memory you sold MCR to buy more of PEM about the 20th of march accordong to your posts. I said never sell an uptrending stock, or buy a downtrending stock which is golden rule number one, and two, for any self respecting TA investor.
You posted that on the 20-3-07 you bought 10,000 more PEM at $3-55.
The TA buy signal for PEM was with my signal was on 20th of april at $4-00. Giving you a win of 45c. MCR the one you sold, increased from $3-00 to $4-60 in the 2nd week in july when it gave a sell signal. YOU sold a stock that improved by 53.3%, I still think you are playing catchup TRICHA you got away with it this time. If you had sold your origional holding of PEM on the first sell signal of the year in jan you really might have had a decent win. macdunk

[tricha]

Hi Duncan - just to set the record straight, I'm "not" a self respecting TA investor and never will be :(

Looking at a chart or looking at the clouds to come up with an answer is the same thing, u can come up with any conclusion or dilusion, depending on how many ports or whiskeys u have consumed [:o)].

I swing towards value investing and rely on factual information. The only trends I follow are the ones on KitcoMetals.

And u are right I stuffed up on Zinc 6 monthes ago :( Lession learnt and have applied to Nickel AND Oil [:p]

Hence retirement due soon [:p] From my current job of 34 years, now the challenge begins ;)

So u stick to your TA and the best of luck and I'll stick to buying value companies in a downtrend.

Cheers [B)][}:)]

P.S Interesting times ahead for PEM [:p]

[steve fleming]

Good call Tricha!

But TA investing is useful for those people that lack the business/ industry /commercial / accounting skills to undertake meaningful FA/value investing.

[Viking]

Tricha, could I ask you a naive question?

between PEM (approx $5, PE7.6) and ZFX (approx $20, PE6) both in Zinc, which one do you fancy say by the end of this year? or even in 1 year time?

I guess the question I am asking is what value do you perceive in the two of them~

Thanks~ (this make it sound like a question for beauty pageant~ haha~[:o)])

Disc: hold neither~

[duncan macgregor]

quote:Originally posted by steve fleming

Good call Tricha!

But TA investing is useful for those people that lack the business/ industry /commercial / accounting skills to undertake meaningful FA/value investing.
Completely wrong STEVE. TA is a usefull tool for any investor. Regardless of how good or bad you are with your arithmetic, TA gives you the over bought or over sold signals. PEM is a perfect example of a good fundamentely sound company being over bought, then over sold. If you paid attention to what the market did, you would have made double the profit not play catchup getting back to where the share was in january. Good fundamental analysis is enhansed by good TA buy and sell signals, if you dont pay attention to that then you spend a lot of time playing catchup. macdunk

[whiteheron]

Funny things markets !

PEM have come out with what seems to be to me (on a first quick read) a pretty good quarterly report, but what does the share price do, it falls by around 10c
This does not concern me as I purchased PEM just over a month ago at $4.06 at what I considered (and still consider) to be a good price

The share price had taken a big hit following a mine fatality around January, had moved up a bit then fallen again and it was at this point that I purchased

I use a combination of FA and TA when assessing the value of a share and I agree with macdunk that PEM is a fundamentally sound company
It has very good resources, pays a Divend, has a heap of cash, and has all appearances of being professionally managed by people who know what they are about

For me it is a long term hold , along with a handful of other shares that I have

[duncan macgregor]

A question for you TRICHA. I thought the quartely report out to day was not to bad a report, why the share price drop?. Has the market over reacted expecting more, or why the sudden change in expectation. Interested to hear your view, i thought it was an over reaction will be interested to see how high the next high goes from a TA perspective. Macdunk

[zac]

Sydney - Thursday - July 19: (RWE Australian Business News) -
Perilya Ltd (ASX:PEM) has reported full-year production from Broken Hill of 92,100 tonnes of zinc and 60,500 tonnes of lead. Increased June quarter production of 22,000 tonnes zinc and 14,500 tonnes lead, coupled with higher lead prices, resulted in net cash operating costs of US58c/lb, 60pc lower than the previous quarter. Cash operating margin of US85c/lb zinc was comparable to that achieved in the first half of 2006/07. The fifth anniversary of Perilya's ownership of the Broken Hill mine was marked on June 1. Since acquisition, the operation has produced 642,000 tonnes of zinc, 298,000 tonnes of lead and 8.6 million ounces of silver. During this period, the ore reserve has been broadly maintained. At Flinders, open-pit mining operations at Beltana continue ahead of schedule and under budget. A total of 10,544 tonnes of high-grade ore at an average grade of 33.9 per cent zinc was mined during the quarter. Resource drilling at Reliance has returned "excellent" results, including 36 metres at 31.8pc zinc from 58 metres. The process of obtaining development approvals has commenced for the Reliance, Moolooloo, Aristotle and Aroona2 deposits, located within 15 kilometres of the Beltana operation.

[tricha]

Whiteheron -"It has very good resources, pays a Divend, has a heap of cash, and has all appearances of being professionally managed by people who know what they are about"

Duncan, I totally agree with Whiteherons summarization, an outstanding report from a quality company with big things happening over the next 12 monthes.

PE of 5 for 2008 on target (as long as zinc does not tank ), cheap as chips.;)

Why the price dropped today, it doen't matter, mine are in the bottom drawer same as Whiteherons.

Cheers [B)][}:)]

[duncan macgregor]

quote:Originally posted by tricha

Whiteheron -"It has very good resources, pays a Divend, has a heap of cash, and has all appearances of being professionally managed by people who know what they are about"

Duncan, I totally agree with Whiteherons summarization, an outstanding report from a quality company with big things happening over the next 12 monthes.

PE of 5 for 2008 on target (as long as zinc does not tank ), cheap as chips.;)

Why the price dropped today, it doen't matter, mine are in the bottom drawer same as Whiteherons.

Cheers [B)][}:)]
TRICHA, With a basic TA sell system you would have sold out in January and bought back in june july on a buy signal. This has nothing to do with fundamentals being right or wtong but only market sentiment. White Heron and i both understand the logic of this but you appear to think all that matters is the PE of a company. White heron and i both go over the fundamentals first then the TA indicators second. I understand white Herons investing strategy which is very similar to my own sugest you look at the AGM thread then think what you might have done here. Macdunk

[tricha]

Looking like the "Value" in this quality company is being recognized.

On a market down day, the fund managers must have done the numbers and come up with the right answers

When u look at the P.E ratios of BHP and RIO its not hard to understand Perilya is still relatively cheap.

I still can not fathom why PEM has not come up as a prime take over target with no majority interest [?][?][?]

Cheers [B)][}:)]

[duncan macgregor]

Well it looks like i joined you boys and girls with this one. I just bought in this afternoon sold down most of my nickel stocks over the last few days, lucky enough to strike MRX right on the button. I am looking to spread out more into different safe havens than in the past. Pem looks a good safe bet to me over the longer term. Macdunk

[scorp57]

bought PEM last june for $2.45. still holding on and not even considering selling.

one of the best companies in the ASX, with great upsode potential. new mine online, i forecast next year ore to be around 130,000 tonnes zinc.

compared to this year 92,000

[Tye]

hi Guys/Girls,
I'm new to this forum. Whats everyone thinking about perilya now. Taken a battering and wiped out 30% so fast. Its certainly making reports on the biggest loser for the day. Do you guys think it can recover, because i just find it hard for a so called "strong" share to plummett and then just carry on back up to the previous highs. I'm just very confused because 2006 was such a good year and 2007 is such a bad one.:confused:

[soulman]

I bought PEM once but with Zinc prices down and strong AUD, not sure what PEM can offer other than corparate appeal. I would prefer ZFX because of their strong yield.

I might look to enter PEM again once their result are out later this month.

[tricha]

Well it looks like i joined you boys and girls with this one. I just bought in this afternoon sold down most of my nickel stocks over the last few days, lucky enough to strike MRX right on the button. I am looking to spread out more into different safe havens than in the past. Pem looks a good safe bet to me over the longer term. Macdunk

Dam wish I had more money for todays bargin bin, Perilya.

Looks like fund managers dumping, they probably think it produces nickel :p

As Duncan states PEM is a good safe bet for the long term.
While Zinc stays strong I might add.

Cheers

[scorp57]

i bought more today aswell. $3.90. too cheap if you ask me. UBS only just increased their shareholding from 15% to 17% of the company and axa asia pacific increased last week aswell.

not sure why the sell off today, but for an EPS for 2008 of around 80c-$1 and a dividend of around 20c, it looks like almost the best value on the asx to me.

oh also got more zinifex today too. and more AED. great buying oppurtunity altho we will have to see what happens in the short term.

[steve fleming]

i bought more today aswell. $3.90. too cheap if you ask me. UBS only just increased their shareholding from 15% to 17% of the company and axa asia pacific increased last week aswell.

not sure why the sell off today, but for an EPS for 2008 of around 80c-$1 and a dividend of around 20c, it looks like almost the best value on the asx to me.

oh also got more zinifex today too. and more AED. great buying oppurtunity altho we will have to see what happens in the short term.

Well, with a consensus 08 PE of just over 4, it is certainly the cheapest on the ASX200 - (although based on 09/10 earnings CMR leaves everthing else on the ASX200 for dead)

If you exclude/adjust for PEM's $150m+ surplus cash, then this PE reduces to closer to 3.

However, in these irrational times, fundamentals mean little, esp with what seams like a major re-pricing of risk happening at the moment.

PEM also is suffering as a result of some unfavourable media reports over the last week as to its current lack of success in marketing its Beltana ore.....plus the sell down by its major shareholder has unsettled the register.

I wouldn't read too much into UBS increase in its stake as that pretty much relates to UBS's relevant interest in stock pursuant to a margin lending facility...AXA looks better - they seemed to have picked up some of Korea Zinc's sell down.

So I'm not buying yet, PEM has always been incredibaly volatile, don't know where its going to settle given current market conditions.

[whiteheron]

Tricha

I have been looking at PEM for a while now and agree with you that it has a great deal going for it
Had a small holding and have added a further two parcels in the last couple of days

I am sure that we will be well rewarded in the next year or two

[moimoi]

Well it looks like i joined you boys and girls with this one. I just bought in this afternoon sold down most of my nickel stocks over the last few days, lucky enough to strike MRX right on the button. I am looking to spread out more into different safe havens than in the past. Pem looks a good safe bet to me over the longer term. Macdunk

MacDunk,

Are you still holding?? It would seem that the major shareholder sold out as you bought.

Chart now looking particularly sick from an OBV perspective.

I don't follow this stock but am just dusting off the buying goggles, and scouting around to take advantage of bailing nervous nellies!!...

I'd add that this thread is beginning to take the form of the AGM thread back in april/may; where the only postings are a series of loud whooping and hollorings as to how wonderful the stock is......

No one has been able to come up with any explanation as to why the major shareholder has sold out.??????? Any ideas..??

This makes me more nervous than the try hard day traders churning their 500 shares each day...

[winner69]

MacDunk,

Are you still holding?? It would seem that the major shareholder sold out as you bought.



Macdunk still holding ...... no way

That post was 26/7 when PEM was 477-502 ..... his timeline would have had him out by now .... no way would macdunk be holding at 387

[scorp57]

perhaps short term and from a traders' perspective, yes it is volatile. but find me a stock that isnt volatile at the moment.

fundamentally a great company with good yield and a great outlook for 08. Thats good enough for me.

not everything is doom and gloom all the time.

As wise men say, "it can't rain everyday"

[tricha]

Tricha

I have been looking at PEM for a while now and agree with you that it has a great deal going for it
Had a small holding and have added a further two parcels in the last couple of days

I am sure that we will be well rewarded in the next year or two

We should see a dividend announced in the next few weeks and I'm guessing 20 cents and if this market is only a correction, we will all be very well rewarded in the next few weeks.

To think someone posted we should compare PEM to AGM, shame on u, blasphemy.

1 - Perilya is a producer - AGM isn't

2 - Perilya has 140 million + in the bank - AGM is in Debt

3 - Perilya has excellent management - AGM management are suspect, hence their snouts in the trough and poor performance.

4 - Perilya have huge upside with quality new high grade projects coming on stream now -AGM waiting, waiting, waiting for 8,000 tons a year nickel shared between 750 million shares.
(If u can not work that out, do not touch the metals market)

5 - Perilya has only 200 million shares - AGM has 750 million.

And the beauty of it all, some dumb-ass fund manager sold 6 million Perilya shares at bargin prices on Friday.

Reminds me when AMP dumped Mincor relentless from $1.00 down to 64 cents not that long ago :p

Cheers

[soulman]

When will PEM post their result? The result is going to be as expected (won't be that spectacular) with all the bad news of production disruption factor in the stock price. The outlook statement is what I will be looking at before I look to buy, along with their bank balance.

[scorp57]

all the bad news was factored in after new years when the price hit $5.80 then sunk to $3.50.

I think it's important to remember that not only will they resume to normal production in 2008, but also have the other mine operating now, AND!!!! the lead price has risen spectacularly.

EPS of 80c-$1 2008.

[steve fleming]

Probably 3 key things the market is waiting on w.r.t. PEM:

1) - results of North Mine Deeps P/F study (& already significantly slippage here) - a potential $200mil investment for 4.2 mt @ 11% Zn & 14% Pb.....which, if given the go ahead, will be a company maker for PEM.

2) Flinders - whether the low grade ore can be mixed with the high grade stuff, siginifcantly enchancing the economics of the project.

3) M&A activities which PEM has been talking up for the last 12 months but has never delivered on (altho PEM were at one stage working with TTY on a JV for CSM).

No doubt about it, PEM is exceptionally cheap on a forward earnings basis, the question is given the inherent risks in relation to PEM, namely the high cost and complex underground mining op's. is whether this risk has been appropriately priced in (ie on a NPV basis)?

[steve fleming]

I see that Paterson Securities re-iterated their buy on PEM yesterday with a strong $5.50 target.

Also consensus 08 earnings are $0.954 per share with forecast cash flows of $1.038 per share.

Consensus cash forecasts for PEM (assuming no acquisitions) as at 30 June 2008 is a massive $275 million.

Also PEM's 08 PE of 4.28 is at a substantial discount to it's peer group (which has an average 08 PE of 9.80) - this discount is too extreme, even allowing for the relative riskiness of PEM's operations....so fundamentally PEM is an excellent buy.

[shasta]

I see that Paterson Securities re-iterated their buy on PEM yesterday with a strong $5.50 target.

Also consensus 08 earnings are $0.954 per share with forecast cash flows of $1.038 per share.

Consensus cash forecasts for PEM (assuming no acquisitions) as at 30 June 2008 is a massive $275 million.

Also PEM's 08 PE of 4.28 is at a substantial discount to it's peer group (which has an average 08 PE of 9.80) - this discount is too extreme, even allowing for the relative riskiness of PEM's operations....so fundamentally PEM is an excellent buy.

Been following your PEM posts Steve, & like what i read...

I'd be happer buying < $4 though...

[steve fleming]

Been following your PEM posts Steve, & like what i read...

I'd be happer buying < $4 though...


Well, you should have a chance to sometime soon Shasta!

PEM is a majorly volatile stock at the best of times, let alone in times like these!

[tricha]

When will PEM post their result? The result is going to be as expected (won't be that spectacular) with all the bad news of production disruption factor in the stock price. The outlook statement is what I will be looking at before I look to buy, along with their bank balance.

The ship is leaving the port without u.:rolleyes:

Thats if the Supercycle is intact of course.:)

[FarmerGeorge]

Zinc price has dropped back a touch but I noticed LME stocks continue to push lower. Under 64000 and dropping - should be good news for PEM.

[winner69]

Zinc price has dropped back a touch but I noticed LME stocks continue to push lower. Under 64000 and dropping - should be good news for PEM.

Almost another 10% today ..... where is it going to stop guys

How much cash per share has PEM got

[soulman]

Winner, about 80 to 85 cents per share in cash. I bought PEM today for their corporate appeal but was deciding between ZFX and PEM since ZFX had a big fall as well. The lead price seems to be doing OK ATM.

[soulman]

Luckily, I bought PEM because that's in the money while if I bought ZFX at the same time, it would be for about $15.50 and bleeding as the market closed mercilessly.

[shasta]

Luckily, I bought PEM because that's in the money while if I bought ZFX at the same time, it would be for about $15.50 and bleeding as the market closed mercilessly.

Under $4 didnt take long & when the market stops bleeding like a shark bite, i'll be onboard PEM.

[soulman]

Well, under water and deep. Shoulda sold yesterday or even sold early this morning.

[Tye]

It doesnt seem to matter how fundamentally strong shares are at all!
I have a suspition that it may be all over for perilya. Honestly why would you buy this share and any other for that matter in this volitile envoronment.
Correct me if you think im to pessimistic but i really believe perilya may fall even more, maybe under $3 until this @#$% settles (if it settles)

[duncan macgregor]

It doesnt seem to matter how fundamentally strong shares are at all!
I have a suspition that it may be all over for perilya. Honestly why would you buy this share and any other for that matter in this volitile envoronment.
Correct me if you think im to pessimistic but i really believe perilya may fall even more, maybe under $3 until this @#$% settles (if it settles) Its a fundamenttally sound share well under priced for what it is. What a great buying opportunity for a good long term investment when the dust settles. There are now so many really good fundamentally sound shares underpriced at the moment that its going to be a difficult choice. Macdunk

[Tye]

Thanks for your view. It is just a real wakeup call that you must have a stop loss and excellent money managment. And with the recent crash 99/100 shares have fallen substantially. With perilya being one of the top losers.
I am holding for the long term anyway and i can onley hope it can come back.

[steve fleming]

It doesnt seem to matter how fundamentally strong shares are at all!
I have a suspition that it may be all over for perilya. Honestly why would you buy this share and any other for that matter in this volitile envoronment.
Correct me if you think im to pessimistic but i really believe perilya may fall even more, maybe under $3 until this @#$% settles (if it settles)

Each week that goes by, PEM generates another $4 million operating cash, to add to the $173 million cash on hand as at 30 June 2007.

I reckon it may just survive.

[shasta]

I still haven't hit the buy trigger, but maybe its cos im a little gun shy & waiting for the dust to settle.

Macdunk's right, so many bargins around now...

[tricha]

"Price is what you pay - Value is what you get!"
BUFFETT

[duncan macgregor]

"Price is what you pay - Value is what you get!"
BUFFETT TRICHA Its not what you or i think a share is worth its what that lunatic MR MARKET thinks its worth. You should have been out of PEM by now, ready to buy in if you had done it right. I too have been caught bottom picking before the turn round lessons i have learned.
1, Keep stop losses up
2, Let the market decide the value of a share.
3, Take your profits and run at the top when it starts to drop.
Fundamental analysis might be all right at the buy end of the deal, but technical analysis is the way to go at both ends of the deal. Better to get out at a small loss as watch in horror to that lunatic mr market puts you under.
Fundamental analysis is about as usefull as tits on a bull in a downtrending market. Macdunk

[shasta]

I get the feeling PEM will soar back into the $4's early this week, so am looking at getting in tomorrow, anything under $3.80 would be nice.

Forward P/E aside, the NTA @ $5.48 is Buffet like (buying a $1 worth of assets for 66c!) at friday's close of $3.62

RSI looks well oversold too...

Sorry Macdunk but TA or not, like Tricha i can't ignore the fundamentals of a cheap company!

[tricha]

Each week that goes by, PEM generates another $4 million operating cash, to add to the $173 million cash on hand as at 30 June 2007.

I reckon it may just survive.

Yes a good dividend coming soon to Shasta for this year.
If they earn $4,000,000 a week x 52 weeks = $208,000,000 for the year profit. That would be a fantastic result.

Duncan you are reading a different book from me, instead of a stop loss u should be putting in a Start Buy.
That's certainly what Warren Buffett would be doing;)

Heres a hint Duncan "The WINNING INVESTMENT HABITS" of Warren Buffett and George Soros.
The best book I've ever read on the sharemarket.

Heres the downside, I only loosely follow it, I've got this bad gambling instinct in me, all my shares are oil or minerals.:o
Warren buys very long term value stocks:p

[duncan macgregor]

TRICHA, I bought in on friday morning four spec shares that i sold out of in the past.
1, PEM, bought back after a 6% prevoius loss owes me 6%
2 AUZ, bought back after a 5% previous loss owes me 5%
2, Mrx got stopped out well in profit bought back friday.
4,Agm, holding at 70c bought on friday at 50c should have stuck to the system and stopped out but having made so much in the past from this company let my guard down.
There you are TRICHA thats what i did i now run a five pc stop loss on every thing until it is well in profit. I also run a 20% uptrending time line from my stop loss level taking me out if the share goes side ways. I suggest you look at your past performance run that system over it in hindesight see if it would have made or lost you money. Buying in is a different story, i like to bottom pick, so picking bottoms can get you covered in it sometimes, but its more fun than TA mechanical selection methods, which have to give a buy signal. Keep me honest TRICHA, i like to give it out in advance of the action so lets see what happens in tomorrows market thats all that counts. Macdunk

[shasta]

Got some PEM @ av $3.82 today, up 10c

Very pleasing...

[scorp57]

great buy shasta, our portfolios are starting to look the same.

Pem should do around $170 mill profit, this year, however next year should be much more. i acatually anticipate at least a 30% production increase for 2008.

i hold AED, PEM ZFX AND URA.

that should hold me for a couple of years

[shasta]

great buy shasta, our portfolios are starting to look the same.

Pem should do around $170 mill profit, this year, however next year should be much more. i acatually anticipate at least a 30% production increase for 2008.

i hold AED, PEM ZFX AND URA.

that should hold me for a couple of years

The forward P/E's for PEM are ridiculously low, & i'd be stoked with a 30% upgrade :eek:

Yeah we have PEM & URA in common (i was also in AED'S little brother NWE a while back too!), though i have even more shares in common with Strat!

Bit weird when Macdunk joins Tricha & I in a stock though!

[steve fleming]

great buy shasta, our portfolios are starting to look the same.

Pem should do around $170 mill profit, this year, however next year should be much more. i acatually anticipate at least a 30% production increase for 2008.

i hold AED, PEM ZFX AND URA.

that should hold me for a couple of years

Only a 30% increase??? I reckon thats a bit light on Scorp.

PEM were on track to do 120kt Zinc, before the accident....(and they ended up doing 90kt)

So lets assume they can do 120kt for 2008 from BH.

Then theres the 15kt from Flinders (assuming they can do a deal with the low grade stuff)

So thats an additional 45kt

So thats a 50% increase on 2007...ignoring any possible production upgrades at BH!!

[shasta]

Didnt take long to start the upwards climb...

$3.98 finish & looking strong to break thru $4 in the lead up to the divvie ann...

Glad i got in @ $3.82!

[scorp57]

steve i couldnt agree more, but i try to do things like MACBank. hence why i said at least 30%...

good to have you on board shasta.

i am still hangin in on ura

[shasta]

steve i couldnt agree more, but i try to do things like MACBank. hence why i said at least 30%...

good to have you on board shasta.

i am still hangin in on ura


Cheers, feels good to be onboard, especially up 16c in a day in a half, with nice Divvie/DRP to come! :p:D;)

[soulman]

I sold PEM yesterday at just over $4. Saw the result of fellow mid tier mining coy of MCR and KZL yesterday and was impressed with their result. I just want to get out in case there is another storm. Have we seen the bottom in the market, I reckon so but any other fallout in the US can result in a slowdown in commodity prices.

[shasta]

I sold PEM yesterday at just over $4. Saw the result of fellow mid tier mining coy of MCR and KZL yesterday and was impressed with their result. I just want to get out in case there is another storm. Have we seen the bottom in the market, I reckon so but any other fallout in the US can result in a slowdown in commodity prices.

The market caught wind, you got out & PEM was sold down as shareholders scrambled to join you...PEM finishing $3.81

Must say IGO & LGL had great results out today...

Am tempted...;)

[steve fleming]

great buy shasta, our portfolios are starting to look the same.

Pem should do around $170 mill profit, this year, however next year should be much more. i acatually anticipate at least a 30% production increase for 2008.

i hold AED, PEM ZFX AND URA.

that should hold me for a couple of years

Scorp - $170m??? for 07 or 08??

Consensus earnings estimate is only for $80m odd (42cps)!!
-however i assume this excludes earnings relating to sale of non-core assets.

I am pretty confortable that PEM will over-deliver relative to estimates, given they earnt $76m (39cps) just in the first half. Not withstanding the loss made in Q3, they should have made this up plus plenty more in Q4.

I'm hoping for NPAT somewhere round $100m, including abnormals.

That should satisfy the market esp with 08 to look forward to.

The crucial loss in Q3 highlights how risky PEM is at the moment as essentially just a one mine company - looking forward to the M&A actoin...or at least PEM diong something with the $200m cash they have on their books at the moment.

Any other PEM followers have profit guestimates??

[soulman]

Lucky to buy PEM back at $3.83 yesterday, seeing today's action. In a way, great trading. Offsetting this, selling AMP at the close yesterday, now that's bad timing there. As a trader, I sold FXJ and PPT on Monday and TTS on Tue. Timing wise, not very good this week.

Will watch ZFX result today and compared it to PEM. PEM is due to report late next week.

[soulman]

ZFX will report on Monday next week. Commodity stock is having a field day today, compared to yesterday. Looks like the market is having a quicker recovery than I expected (it's all due to the great profit result we have seen so far). Investors that were sitting on the sideline have no choice but to buy at higher prices now. Surely, profit taking will marked the market down soon.

[shasta]

Scorp - $170m??? for 07 or 08??

Consensus earnings estimate is only for $80m odd (42cps)!!
-however i assume this excludes earnings relating to sale of non-core assets.

I am pretty confortable that PEM will over-deliver relative to estimates, given they earnt $76m (39cps) just in the first half. Not withstanding the loss made in Q3, they should have made this up plus plenty more in Q4.

I'm hoping for NPAT somewhere round $100m, including abnormals.

That should satisfy the market esp with 08 to look forward to.

The crucial loss in Q3 highlights how risky PEM is at the moment as essentially just a one mine company - looking forward to the M&A actoin...or at least PEM diong something with the $200m cash they have on their books at the moment.

Any other PEM followers have profit guestimates??


Steve will crunch some numbers & get back to you, but the MD on Boardroom radio mentioned about the risks of being a 1 mine company & that he hoped the Flinders project would de-risk PEM.

Nice bounce today, & seems the market is in full reporting season positivity.

Isn't IGO looking good...

[scorp57]

sorry steve, you are right, it will be closer to $70 mil, but it should be interesting anyways. i am more concerned on next year.

plus there is the ever escalating lead price, and PEM holds the 6th largest lead mine in the world.

[shasta]

sorry steve, you are right, it will be closer to $70 mil, but it should be interesting anyways. i am more concerned on next year.

plus there is the ever escalating lead price, and PEM holds the 6th largest lead mine in the world.

Am confused trying to work it out - the Perilya website has bugger all valuations going forward or predicted outputs levels that i could find.

They have quite a bit of hedge cover & forward sales cover to limit the downside & ensure exposure to the upside so, ill be bullish & say i think this Qtr will be better than expected & we get around $A90 - 95m incl abnormals.

All that cash in the bank & a rather small amount proposed for exploration in the 2007/08 year, seems a bit weird?

Any thoughts as to what PEM may do with all that cash?

Special dividend/Acquistion?

[steve fleming]

sorry steve, you are right, it will be closer to $70 mil, but it should be interesting anyways. i am more concerned on next year.

plus there is the ever escalating lead price, and PEM holds the 6th largest lead mine in the world.

Yep Scorp - 2008 will be exceptional for PEM, on the proviso that there is no major deviation from forecast BM prices.

Consensus NPAT for PEM for 2008 is about $150m (87.5cps) but there is one analyst out there with a forecast NPAT of $240m - putting PEM on a PE of 3!!

Remember that with Flinders, in 2007 PEM has been incurring costs of production - but has not sold a single pound....so in 2008 PEM gets all the income benefits with reduced costs!!

And Shasta, i'd be happy with $90m-$95m, given what there is to look forward to in 2008!

[shasta]

Yep Scorp - 2008 will be exceptional for PEM, on the proviso that there is no major deviation from forecast BM prices.

Consensus NPAT for PEM for 2008 is about $150m (87.5cps) but there is one analyst out there with a forecast NPAT of $240m - putting PEM on a PE of 3!!

Remember that with Flinders, in 2007 PEM has been incurring costs of production - but has not sold a single pound....so in 2008 PEM gets all the income benefits with reduced costs!!

And Shasta, i'd be happy with $90m-$95m, given what there is to look forward to in 2008!

Who was that Steve?

Would be nice > $200m :eek:

[steve fleming]

Who was that Steve?

Would be nice > $200m :eek:

That was Hartleys - boutique WA outfit, which can probably afford to be a bit out there with their forecasts!

Realistically though, FY08 should be between $150m - $200m....puting PEM on a PE of between 4 and 5.

[soulman]

Shasta, looking back PEM always keep their cash in hand because the half yearly report, they had more than $230 million in cash and now it's less than that at $170 million. That is giving me guidance on the upcoming profits already. A dividend of 10 cents will be the norm. Otherwise, it will not signal confidence in the group for 2008.

[shasta]

Shasta, looking back PEM always keep their cash in hand because the half yearly report, they had more than $230 million in cash and now it's less than that at $170 million. That is giving me guidance on the upcoming profits already. A dividend of 10 cents will be the norm. Otherwise, it will not signal confidence in the group for 2008.

Soulman

How much of the $238.3m cash & receivables at HY, was actually cash?

The last quarterly mentions the $170m as cash...

Interesting to see Zinc & Lead both @ $US3,200T :eek:

[soulman]

I have sold PEM at $4.08 early this morning. Looking at the market depth now, I wished I still hold. I am looking to get in ZFX now to replace my exposure to zinc and lead.

Yes, thinking back, about $20 mil cash would have been deducted from PEM cash balance for the first half dividend as well as ongoing exploration cost. Will look to get back in again but it might just surge to $4.60 before their profit result on Friday next week.

[shasta]

Soulman

I hope your time out of PEM is short, back in Monday?

Why ZFX over PEM, is ZFX due to announce next week as well?

[soulman]

Will look to get back in PEM if ZFX result dissapoints on Monday. ZFX should pay dividend of 70 cents again or maybe higher and they are on a yield of 8% F/F. There seems to be good support for PEM today and a break above $4.20 should see PEM trade at the $4.60 mark next week.

[steve fleming]

Shasta, looking back PEM always keep their cash in hand because the half yearly report, they had more than $230 million in cash and now it's less than that at $170 million. That is giving me guidance on the upcoming profits already. A dividend of 10 cents will be the norm. Otherwise, it will not signal confidence in the group for 2008.

Wrong, wrong & wrong.

Lucky you are a trader.

Your fundamental research leaves a lot to be desired!

[duncan macgregor]

Wrong, wrong & wrong.

Lucky you are a trader.

Your fundamental research leaves a lot to be desired! steve if you say wrong wrong wrong come out with what is right right right, alright. I never bother with crap like that, i look at the profit margin from last year, the expected margin, and take it from the commodoties price chart to make my decisions on buys and sells. Most companies running in profit go up or down following the commodoties price chart if you look it up, making over the top fundamentals a complete waste of time. You are much better paying attention to overseas share markets, and commodoty prices, than bog yourself down with over the top company fundamentals. Macdunk

[soulman]

I did not get ZFX today. I shoulda got them for $15.00 last week but went for PEM instead. I think the smart move is to wait for the result first.

Steve, I know cash flow have nothing to do with profits. Taking $20 mil div cash paid from the first half and further exploration cost will cut cash from their balance sheet and hence, they are where they are now. Also, did not see the receivables from their quarterly report. I noticed you also hold ZFX.

I don't do much research on mining coy, but am starting to look at them now since the great result of BHP and the recent mid tier like MCR, IGO, KZL and OXR.

[shasta]

I did not get ZFX today. I shoulda got them for $15.00 last week but went for PEM instead. I think the smart move is to wait for the result first.

Steve, I know cash flow have nothing to do with profits. Taking $20 mil div cash paid from the first half and further exploration cost will cut cash from their balance sheet and hence, they are where they are now. Also, did not see the receivables from their quarterly report. I noticed you also hold ZFX.

I don't do much research on mining coy, but am starting to look at them now since the great result of BHP and the recent mid tier like MCR, IGO, KZL and OXR.

Must say i liked IGO's result - certainly a company im interested in...

But at a "fair" price :D

[steve fleming]

You are much better paying attention to overseas share markets, and commodoty prices, than bog yourself down with over the top company fundamentals. Macdunk

Fair enough.

Why care about irrelevant things like profit and cash flow anyway? - they're just numbers.

[wns]

Most companies running in profit go up or down following the commodoties price chart if you look it up, making over the top fundamentals a complete waste of time. You are much better paying attention to overseas share markets, and commodoty prices, than bog yourself down with over the top company fundamentals. Macdunk

IMO, even with the profitable commodities stocks with sound fundamentals (plenty of cash, high profits, no / low debt etc), it still pays to keep a close eye on the price action of the underlying commodities they sell.

Take MCR for example (and pretty much any of the nickel stocks), they rose sharply and then fell even more sharply, in concert with the nickel price.

I'm looking for a company with sound fundamentals, good value and the prices of the commodities they sell heading in the right direction.

[scorp57]

ZFX will have a lot of cash swimming around towards the very end of the year.

The thing i love about ZFX is they clearly state that any excess cash they have, they like to return it to shareholders. Now i bought my largest parcel of ZFX for $8 and i can truly say that they have been more than generous to us shareholders.

i am expecting at the very least a 70 c dividend announced next week, and around a $1.3 billion full year profit.

With the de merger of their zinc assets around October with Umicore, might i add that we get 60% of the proceeds, this should generate an extra $2 billion in revenue. Again they clearly state that whatever money can be returned will be.

i mean it could be roughly $4 a share revenue, and even if they gave us an extra 60C special dividend or a share buyback, its gonna be a great story for the market. almost the strongest fundamentals in the near term around.

Shasta- ZFX is a definate buy from me, even if just to trade over the next few months.

[steve fleming]

steve if you say wrong wrong wrong come out with what is right right right, alright. I never bother with crap like that, i look at the profit margin from last year, the expected margin, and take it from the commodoties price chart to make my decisions on buys and sells. Most companies running in profit go up or down following the commodoties price chart if you look it up, making over the top fundamentals a complete waste of time. You are much better paying attention to overseas share markets, and commodoty prices, than bog yourself down with over the top company fundamentals. Macdunk

OK.

Here is my interpretation of PEM's CF movements over the past 6 months based on my review of the quarterly activity statements - Note that PEM do not release quartlery CF statements so my estimates will not be 100&#37; exact.

Balance 31/12/06 ---- $177m - NOT $230m

Add:
Operating CF's ---------- $47m
Sale of Investments---- $14m
Less:
Dividend -----------------($13m) - NOT $20m
CAPEX -------------------($41m)
Exploration exp----------- ($5m)
Corporate expenses -----($4m)

Balance 30/06/07----- $173m - NOT less than $170m


So from the operating CF's we can then estimate profit.

Operating CF's ---------------$47m
Less:
Non cash items per 1st half --($20m)
Tax ----------------------------------($9m)

NPAT(2nd half) ----------------$18m

Add:
NPAT(1st half) -----------------$76m

Gives you FY07 NPAT --------$94m

add in the abnormals and thats my $100m estimate as discussed in my previous posts.

This "over the top" fundamental analysis may be "a complete waste of time" & "crap" to you Macdunk, and to be honest may have gone over your head. However, to me, it is vitally important in assisting in my investment decisions and in this case it certainly makes me confident that PEM is fundamentally a good buy!

Such fundamental analysis has delivered me three (3) 10+ baggers over the last 2-3 years, and countless other multi-baggers. Good luck with your system.

[shasta]

OK.

Here is my interpretation of PEM's CF movements over the past 6 months based on my review of the quarterly activity statements - Note that PEM do not release quartlery CF statements so my estimates will not be 100% exact.

Balance 31/12/06 ---- $177m - NOT $230m

Add:
Operating CF's ---------- $47m
Sale of Investments---- $14m
Less:
Dividend -----------------($13m) - NOT $20m
CAPEX -------------------($41m)
Exploration exp----------- ($5m)
Corporate expenses -----($4m)

Balance 30/06/07----- $173m - NOT less than $170m


So from the operating CF's we can then estimate profit.

Operating CF's ---------------$47m
Less:
Non cash items per 1st half --($20m)
Tax ----------------------------------($9m)

NPAT(2nd half) ----------------$18m

Add:
NPAT(1st half) -----------------$76m

Gives you FY07 NPAT --------$94m

add in the abnormals and thats my $100m estimate as discussed in my previous posts.

This "over the top" fundamental analysis may be "a complete waste of time" & "crap" to you Macdunk, and to be honest may have gone over your head. However, to me, it is vitally important in assisting in my investment decisions and in this case it certainly makes me confident that PEM is fundamentally a good buy!

Such fundamental analysis has delivered me three (3) 10+ baggers over the last 2-3 years, and countless other multi-baggers. Good luck with your system.



Good work Steve

I got around $A90 - 95m myself & concur with your figures.

Macdunk stop winding the PEM holders up, you are one of us!

[duncan macgregor]

Good work Steve

I got around $A90 - 95m myself & concur with your figures.

Macdunk stop winding the PEM holders up, you are one of us! SHASTA I could never bother digging out that sort of stuff. I look at the price on the commodoty chart go by that glance over at the DOW and footsie, then work out the company profit and likely profit according to the commodoty price, and BOBS YOUR UNCLE.
Macdunk

[steve fleming]

This "over the top" fundamental analysis may be "a complete waste of time" & "crap" to you Macdunk, and to be honest may have gone over your head. However, to me, it is vitally important in assisting in my investment decisions and in this case it certainly makes me confident that PEM is fundamentally a good buy!

Such fundamental analysis has delivered me three (3) 10+ baggers over the last 2-3 years, and countless other multi-baggers. Good luck with your system.



Nothing to say MacDunk??


SHASTA I could never bother digging out that sort of stuff. I look at the price on the commodoty chart go by that glance over at the DOW and footsie, then work out the company profit and likely profit according to the commodoty price, and BOBS YOUR UNCLE.
Macdunk

I must say, certainly an interesting way to work out the company profit. Are you then willing to share what you worked out PEM's "likely profit" for this year based on your review of the DOW, FTSE and 'commodOty price'?

Given the commodity price today is irrelevant to the earnings to June, and that the commodity price doesn't effect the 95% of the income statement line items except for revenue....your bobs your uncle approach is certainly different!!

I wonder how this approach accounted for the fact that PEM's major asset was effectively shut down for 3 months this year - i couldn't find this information on the FTSE last time i looked!!

[steve fleming]

According to the AFR, PEM is the 2nd most volatile (risky) share on the ASX200.

So makes it a nice one for you to trade Soulman!

[shasta]

According to the AFR, PEM is the 2nd most volatile (risky) share on the ASX200.

So makes it a nice one for you to trade Soulman!

What ever risk profile we have, forecast profit methods, or following the DOW/FTSE, commodity prices etc, it has gotten all of us into PEM, & goodness me we are arguing about how much $$$ it will make next year...

Lets agree that PEM has great potential "upside" from bringing it's secondary projects like "Flinders" up to speed.

Macdunk youve gone full circle from a fundy to a techie, just don't be outside gazing at the stars wil ya...(we got yogi for that!).

If PEM is 2nd the riskiest, what is the riskiest ? :eek:

My entire portfolio is high risk v high return :D

[duncan macgregor]

STEVE At the risk of upsetting you all over again the rising or falling price of a commodoty has everything to do with the sp. Take a look at the nickel companies share prices then look at the chart for nickel prices. The price of lead is trending up, which will raise the expected profit levels of companies mining it. The DOW had a nice blip look what happened to your stocks as a result. The next crash comes from that direction ignore it at your peril, or take advantage of getting out first.
When looking at tomorrows profit margins, you only get part of the answer by looking at the past. I look to the DOW when making a buy or sell decision. If the dow is down i sell in the morning, if not i sell last thing in the afternoon. You might think that is stupid but it has worked very well for me up to now. The market is a very predictable irrational place that can be worked out by studying and understanding the reasons behind the herds stampedes.
PEM was Fundamentally oversold, simply because the herd got frightened by the DOW going down . What an opportunity to buy that was. Macdunk

[steve fleming]

If PEM is 2nd the riskiest, what is the riskiest ? :eek:



SMY was the most volatile (risky) stock on the ASX200 the last year, Shasta.

Least risky was CBA closley followed by the other banks.

I actually agree quite a bit with what Macdunk says - he's got a common sense approach, although ignoring important underlying fundamentals makes it a bit simplistic.

[shasta]

SMY was the most volatile (risky) stock on the ASX200 the last year, Shasta.

Least risky was CBA closley followed by the other banks.

I actually agree quite a bit with what Macdunk says - he's got a common sense approach, although ignoring important underlying fundamentals makes it a bit simplistic.

Too right Steve, ignoring cashflow is a sure sure of ignorance/arrogance!

SMY is another great mid tier company, & i'm currently looking at IGO too.

I'm a risk taker & tend towards such companies with explosive potential, & use all forms of methods to monitor & evaluate companies.

Macdunk is right to use the commodity charts, as producers SP do tend to follow these up & down.

In some respects i disagree about following the DOW, as it bears no relation to ASX fundamentals, & normally (like the last correction) any falls represents buying opportunity...

[duncan macgregor]

What amazes me is how a simpleton like my good self can hold MCR, AGM, SMY, in 2007 at no cost to his simple self when so many smart people bog themselves down in mathematics.
I bought MCR, AGM, SMY, SMM, on jan 3rd . I now have all my money out with those three companies with a similar ammount of money left in at nil cost to me. That is my long term portfolio that cost me nothing to buy after seven months so i reckon i might just stick them under the bed to accumulate dust. My trading account is miles ahead of that i had the whole lot riding on SMM at one stage now a large proportion riding on PEM. I did have a loss with my first buy, but now in profit only just at the moment. The fundamentals are good, with rising commodoty prices so i expect to make a good profit before it becomes overpriced which it will in time. Macdunk

[steve fleming]

What amazes me is how a simpleton like my good self can hold MCR, AGM, SMY, in 2007 at no cost to his simple self when so many smart people bog themselves down in mathematics.
I bought MCR, AGM, SMY, SMM, on jan 3rd . I now have all my money out with those three companies with a similar ammount of money left in at nil cost to me. That is my long term portfolio that cost me nothing to buy after seven months so i reckon i might just stick them under the bed to accumulate dust. My trading account is miles ahead of that i had the whole lot riding on SMM at one stage now a large proportion riding on PEM. I did have a loss with my first buy, but now in profit only just at the moment. The fundamentals are good, with rising commodoty prices so i expect to make a good profit before it becomes overpriced which it will in time. Macdunk

Macdunk,
this conversation is getting tedious.

However i'll just quickly make some important points.

1) You have only been investing in commodities since 3 Jan 2007!!

Thats a little over 6 months and you now think you have an unbeatable system??? think again mate!

The period since then has been one of the most volatile periods for a long long time in relation to commodity pricing (esp Ni and U) as hedge funds got on board and the china/india story unfolds.

How will your system go if stability returns to the pricing and that you can't rely on volatile commodity pricing to guide you??

Anyway i don;t know how your system goes in relation to non-commodity stocks?? Non - commodity stocks make up the bulk of my portfolio, and i apply the same fundamental analysis across the board.


2) to be honest if you have only invested in MCR,SMY ans AGM since 3 Jan 2007, then you missed out on by far the biggest increases in these stocks during the period 2005 - 2006. MCR was a screaming fundamental buy for most of early 2006 at around 70 cents...thats when i got on board...yet you waited until it was $2.00 odd early this year??? By the time you got on board it was already a 2 bagger for me.

Yes, you have probably made some good coin the last6 months, well done, but 6 months is a sh*t f**k all time in the markets, and to be honest its been easy money the last year, up till the last few weeks.

Seriously mate, and i 100% mean this, cos i worry about you - you should go do an adult accounting course so you can get a handle on key fundamentals - it will seriously be something you won't live to regret. You won't find it as hard and as daunting as you think.

It may also enable you to research your own picks, rather than piggy-backing off other's research and relying on others to do the hard work for you.

Have you ever started a thread with some of your own research on a stock pick?? - if you lack the fundamental skills it makes it very hard.

[duncan macgregor]

Steve you are being judgemental on something you know nothing about. My first share investment was ALLSTATE in the sixties followed by APOLLO mining, and PEKO mines at tennant creek where i worked at the time building the mining camp. I wiorked in portheadland, Alice springs,Tennant creek, learned first hand about mining from the miners i used to drink with. I am now a retired builder, so dont tell me anything about fundamentals. Allstate was next door to poisiden which started out at 50c a SHARE. A friend of mine into shares said buy it at $15, which being a fundamentalist like your good self said no way its over priced. Poisiden went toover $230 a share then dropped back to where it started. I was to stupid to buy he was to stupid to sell. APOLLO mining sp went up and down everytime the yanks put a rocket up which was lesson number two. I scored with POA in NZ at the Americas cup in a big way. The PE was miles to high but the publicity the port received more than made up for it. If you only think that last years numbers are the only consideration then you have a lot to learn. The price of PEM commodoties is rising they had a bad year last year plus the sp took a hit with the DOW going down, take your blinkers of the numbers, are only part of the answer. MACDUNK

[steve fleming]

Lets move on MacDunk and hope that PEM makes us both a motza.

[duncan macgregor]

Lets move on MacDunk and hope that PEM makes us both a motza. Copper price up lead price up the DOW and Footsie up PEM share price up on monday which ever way you do your homework. MACDUNK

[shasta]

Copper price up lead price up the DOW and Footsie up PEM share price up on monday which ever way you do your homework. MACDUNK

Zinc marginally down though...

The buy depth last Friday suggests a few trying to buy in ahead of the annual result due out Friday, so i'd expect a strong start to the week tomorrow...

[Mick100]

, learned first hand about mining from the miners i used to drink with.

Havn't you ever had a beer with a minor flemming :D
,

[countryboy]

after some 6 mths of reading the posts on this site i decided to join last night. Borrowed this from my cousin on HC-don't worry I wont stoop to the level of posting seen on HC !

we pulled 11.000 tonnes out last mth....70000 after a wee bit of a muck around will be stock piled as it is low grade. if PEM goes down the nth deeps they will have to look at an upgrade of the mill as they can only do a small % of lead due to letting some equipment slide.(more lead in the Nth)

Its still all good news..as long as the metal prices stay above 2003 levels BH remains a very profitable mine.

The boys who dropped the load into the water at POTOSI...stop trying to wash the ore !!!!

The other interesting thing i have been told is that PEM still don't know which direction they will go in the future. development of the North mine is possible but at a significant cost - figures suggested 60 mill to as little as 10million for a decline. At 2-3 km underground it gets pretty hot so shorter shifts less production etc

whilst Im here i must thank trish for the GGY tip ...made a nice profit on that.:D

cheers

[whiteheron]

I have been following this thread with interest as I have a couple of parcels of PEM

Just to satisfy myself I spent a couple of hours reviewing a number of PEM Announcements released over the last few months
I wont go into the details,they are all there should you want to read them

My conclusion is that PEM will be a very good hold for the next year or two at least
It has virtually all of the things that I look for going for it --- and it has heaps of money and pays dividends, something that few mining companies do

The last years results may not be all that flash, but the future will be bright I believe

Time will tell
I will continue to hold

[soulman]

Great market and great result from ZFX. Missed out on Friday and licking the wound. The rise in the US markets helps. Otherwise ZFX would be slightly down if the world market had a bad day at weeks end.

All miners having a field day again.

[fihr]

I like ZFX result, but some analysts were expecting them to announce a special div, which didn't happen, so not everyone will feel happy with it.

Discl: I hold ZFX shares.

[shasta]

I like ZFX result, but some analysts were expecting them to announce a special div, which didn't happen, so not everyone will feel happy with it.

Discl: I hold ZFX shares.

PEM moving along nicely in anticipation of it's FY result...

Got in at the right time so it seems...

[fihr]

Yeah, I also hold PEM. But I bought a bit too high as I'm no good at bottom picking ($4.80). Not worried as its a 12 month hold, and its outlook is excellent!

[shasta]

Yeah, I also hold PEM. But I bought a bit too high as I'm no good at bottom picking ($4.80). Not worried as its a 12 month hold, and its outlook is excellent!

I certainly wasnt trying to catch a falling knife, i got in at $3.82 av. after i read the NTA was $5.46 per share!

Shasta likes buying "cheap" shares, & sub $4 has a good margin of safety in it IMO.

Just hope PEM have kept the DRP going, i don't want the cash!

[Dazza]

shasta whered u find the NTA for PEM?

[shasta]

shasta whered u find the NTA for PEM?

Got it off ASB Securities, will try & post it for you...

Charts - Perilya Limited
Share prices at 19:00:00 Monday, August 27, 2007

https://ost.asbbank.co.nz/Images/spacer.gif Stock Market Bid Offer Last CHG* Open High Low VOL Turnover PEMASX 421422422 https://ost.asbbank.co.nz/images/up_triangle_green.gif144154274 121303925$5,452,413https://ost.asbbank.co.nz/Images/spacer.gif PE 6.15 EPS 66.30 DPS 14.00 Yield&#37; 3.43 NTA6.18 https://ost.asbbank.co.nz/Images/spacer.gifhttps://ost.asbbank.co.nz/Images/btn_buy.gif (https://ost.asbbank.co.nz/000A7E58A5B0BD9110919A98319AF1A3/OnlineTrading/Trading.aspx?ordertype=buy&exchange=ASX&stockCode=PEM)https://ost.asbbank.co.nz/Images/btn_sell.gif (https://ost.asbbank.co.nz/000A7E58A5B0BD9110919A98319AF1A3/OnlineTrading/Trading.aspx?ordertype=sell&exchange=ASX&stockCode=PEM)https://ost.asbbank.co.nz/Images/btn_market_depth.gif (https://ost.asbbank.co.nz/000A7E58A5B0BD9110919A98319AF1A3/Quotes/Quotes.aspx?exchange=ASX&stockCode=PEM&comp=Perilya+Limited&d=true&stockBar=quotedepth&sbErr=)

Actually ASB have recalculated it, to $6.18!

Sorry for the poor editing, it looked good when i copied it!

[Dazza]

i am tossing up btw pem or zfx

[steve fleming]

Got it off ASB Securities, will try & post it for you...

Charts - Perilya Limited
Share prices at 19:00:00 Monday, August 27, 2007

https://ost.asbbank.co.nz/Images/spacer.gif Stock Market Bid Offer Last CHG* Open High Low VOL Turnover PEMASX 421422422 https://ost.asbbank.co.nz/images/up_triangle_green.gif144154274 121303925$5,452,413https://ost.asbbank.co.nz/Images/spacer.gif PE 6.15 EPS 66.30 DPS 14.00 Yield% 3.43 NTA6.18 https://ost.asbbank.co.nz/Images/spacer.gifhttps://ost.asbbank.co.nz/Images/btn_buy.gif (https://ost.asbbank.co.nz/000A7E58A5B0BD9110919A98319AF1A3/OnlineTrading/Trading.aspx?ordertype=buy&exchange=ASX&stockCode=PEM)https://ost.asbbank.co.nz/Images/btn_sell.gif (https://ost.asbbank.co.nz/000A7E58A5B0BD9110919A98319AF1A3/OnlineTrading/Trading.aspx?ordertype=sell&exchange=ASX&stockCode=PEM)https://ost.asbbank.co.nz/Images/btn_market_depth.gif (https://ost.asbbank.co.nz/000A7E58A5B0BD9110919A98319AF1A3/Quotes/Quotes.aspx?exchange=ASX&stockCode=PEM&comp=Perilya+Limited&d=true&stockBar=quotedepth&sbErr=)

Actually ASB have recalculated it, to $6.18!

Sorry for the poor editing, it looked good when i copied it!

Hi Shasta, i don;t think this is correct. It should be a lot lower than what ASB quote.

[shasta]

Hi Shasta, i don;t think this is correct. It should be a lot lower than what ASB quote.

Have been trying to locate the article where i saw the $5.48 figure...:confused:

[steve fleming]

hmmm. I calculate the NTA as about 90 cents.

[shasta]

Hi Shasta, i don;t think this is correct. It should be a lot lower than what ASB quote.


Has anyone seen the PEM ann today re Gold divestment?

Total consideration is $A14.75m is for selling the following mines:

- Daisy Milano Mine
- Mount Monger
- Moyagee
- Honeymoon projects

Selling to Silver Lake Resources Ltd - another IPO before 30 Nov 07.

Consideration for $8.5m cash & $6m in "Silver Lake" shares & $0.25m in royalties...

More $$$ for the cash pile :D

[shasta]

hmmm. I calculate the NTA as about 90 cents.

I hope i haven't put anyone crook, i've got this sinking feeling i saw a P/E ratio around 5 or 6 & maybe NOT it's NTA!

I was sure i saw it, nevermind will see if i can find it as i referred to it a page or two back as well... :confused:

[SEC]

Perilya has thrown in the towel on their Dog Milano gold mine on the guise that they're preparing it for divestment. Yeah right, they've struggled to make any decent money from this mine since its purchase and will probably get only peanuts for it. At least they've made the tough call on suspending operations and are able to move valuable resources elsewhere. Probably the correct decision but the market may not like it short term. PEM is higher up on my watchlist now.

SEC

Dog Milano + 3 other gold tenements sold for $15M to Silver Lake Resources. In reality they probably threw in Dog Milano for free. The end of a sorry and expensive saga for Perilya. Good to see they're moving on.

SEC

[soulman]

Not sure how to read this but the 1 cents dividend is not much at all. At least they could have match the 4 cents last year. Anyway, the result were expected.

Will stay out of PEM now, unless they drop to $3.50 again.

[SectorSurfa]

http://imagesignal.comsec.com.au/asxdata/20070828/pdf/00752695.pdf

[shasta]

http://imagesignal.comsec.com.au/asxdata/20070828/pdf/00752695.pdf

Now try doubling that profit figure for 2008 & halving the P/E ratio :D

Soulman - the 1c Divvie was a non event - they should have kept the cash & made it up at the interim dividend.

I was a tad disappointed with the FY result, but given the previous quarter wasn't good at all, not bad & i guess the market agrees...

Roll on 2008 :cool:

[STRAT]

hmmm. I calculate the NTA as about 90 cents.Direct Broking says 66c :confused:

[soulman]

Shasta, yeah, it's good to have an optimistic view about a company future but as with all mining stock, you can't just assume commodity prices are going to stay at current level or go higher. Like DuncanMac said, the fundamental of commodity prices has a more detrimental effect to share prices than fundamental analysis. Just like fear is more potent than greed. And losing $1 is more hurtful than making $1.

I see dividend as a supporting ingredient in a company prospect and hence I would not touch any stock that don't pay dividend like I used to in the past. Increased dividend is a sign of confidence in a company. The main thing is that the share price of PEM react quite OK to the result so that is good for all PEM holders.

[tricha]

shasta - "Now try doubling that profit figure for 2008 & halving the P/E ratio :D

Yes the upside next year will be huge as long as Zinc stays up there.


Soulman - the 1c Divvie was a non event - they should have kept the cash & made it up at the interim dividend."

You are right about the dividend Shasta, all the paperwork and costs envolved, absolute waste of money. Far better as u say add to the interim.

I might even write to them and ask the question and also imply a 40% policy dividend would be more in line.

[shasta]

shasta - "Now try doubling that profit figure for 2008 & halving the P/E ratio :D

Yes the upside next year will be huge as long as Zinc stays up there.


Soulman - the 1c Divvie was a non event - they should have kept the cash & made it up at the interim dividend."

You are right about the dividend Shasta, all the paperwork and costs envolved, absolute waste of money. Far better as u say add to the interim.

I might even write to them and ask the question and also imply a 40% policy dividend would be more in line.

They have said they are keeping with there policy of paying out 25%, but for 1c is it worth it?

I'd rather they forego the dividend & use the cash to pay off/down debt.

I'll take the DRP with the 2.5% discount & be happy though...

[steve fleming]

Scorp - $170m??? for 07 or 08??

Consensus earnings estimate is only for $80m odd (42cps)!!
-however i assume this excludes earnings relating to sale of non-core assets.

I am pretty confortable that PEM will over-deliver relative to estimates, given they earnt $76m (39cps) just in the first half. Not withstanding the loss made in Q3, they should have made this up plus plenty more in Q4.

I'm hoping for NPAT somewhere round $100m, including abnormals.

That should satisfy the market esp with 08 to look forward to.

The crucial loss in Q3 highlights how risky PEM is at the moment as essentially just a one mine company - looking forward to the M&A actoin...or at least PEM diong something with the $200m cash they have on their books at the moment.

Any other PEM followers have profit guestimates??


OK ish result. Slighlty better than the analysts were expecting ($80m) thus the neutral reaction from the market.



However, like Shasta, was below my expectations as there were some write downs of Daisy Milano there.


The fact that they are retaining cash suggests they finally may have a decent acquisition lined up.



Anyway at least 2007 is out of the way and we can look forward to 2008 which should be massive for PEM as they ramp up production.


Should kick on nicely now.

[whiteheron]

All in all I was relatively happy with the results as I was not expecting anything outstanding

But looking at the future I am very confident that PEM will perform exceptionally well
A number of advanced very prospective projects on the go, plus :
All that cash, giving great flexibility to move quickly on opportunities
Well managed, in my opinion
Lead is now more than a by product, price currently above that for zinc (which is not likely to tank to any great degree in my opinion
Have you seen the Ni grades ? Exceptional !!!

I feel that the price will not move quickly but within 12 months should rise substantially as good news comes out

Time will tell, but I intend to keep holding

[duncan macgregor]

BAD DAY TODAY LOOMING FOR PEM. Nothing to do with fundamentals steve but everything to do with market sentiment. Lets see if market sentiment is proved right today. If i intended selling which i am not it would be first thing this morning. Macdunk

[shasta]

BAD DAY TODAY LOOMING FOR PEM. Nothing to do with fundamentals steve but everything to do with market sentiment. Lets see if market sentiment is proved right today. If i intended selling which i am not it would be first thing this morning. Macdunk

Drop of 19c to finish at 399c - not too bad though a tad more the market in general.

Had it not been for the announcement of the 1c divvie who knows how much further it would have plummeted :eek::D:D

[steve fleming]

Well, the analysts liked the result.

GS JBWere, Macquarie & UBS all came out with a buy on PEM today, all with $5+ targets.

Also 2008 consensus confirmed at 88cps, officially putting PEM on a PE of 4.8.

[shasta]

Well, the analysts liked the result.

GS JBWere, Macquarie & UBS all came out with a buy on PEM today, all with $5+ targets.

Also 2008 consensus confirmed at 88cps, officially putting PEM on a PE of 4.8.

Steve

ASB Securities have updated there 2008 outlook on PEM:

Consensus: EPS 88.0 (One Analyst had EPS of 134.9c on a P/E <3!)

P/E: 4.5
DPS 22.3
Yield: 5.6%

BTW, Lowest EPS was at 72c

They have 2009 as very similar to 2008.

[soulman]

I see no catalyst for PEM to rise in the near term. Most of the money has been shift to ZFX and with the sale of their smelting operation into Nrystar, the proceeds return to shareholders could be substantial. The 70 cents dividend is a long wait though so I am not jumping in as yet. ZFX to merge with PEM is a possibility.

SMY report a good result today and IGO currently have the lowest PE among mid tier, hence, making them a potential takeover target.

[SectorSurfa]

IGO forward PE is not as good though?

eps to drop from 90c to 56cps 2008?



maybe why they are on the lowest PE at present

[shasta]

I see no catalyst for PEM to rise in the near term. Most of the money has been shift to ZFX and with the sale of their smelting operation into Nrystar, the proceeds return to shareholders could be substantial. The 70 cents dividend is a long wait though so I am not jumping in as yet. ZFX to merge with PEM is a possibility.

SMY report a good result today and IGO currently have the lowest PE among mid tier, hence, making them a potential takeover target.

Agree with your comments re SMY, it's on my target list along with JML.

Both look far to cheap looking at 2008/09 P/E ratios

[Dazza]

sector 56 cps? care to explain mate?

[SectorSurfa]

sector 56 cps? care to explain mate?

consensus earnings for 08 from Commsec, had 90c for this year.

hence the question marks???

I wondered how accurate it is

[soulman]

Dazza, you sold MBL?

[soulman]

PEM is struggling ATM. There is at least one insto selling this stock and this could last for a week or two. There will be support for PEM around $3.60 though but any push below that will be bad. This time I am sitting out as there are more other attractive stock than PEM ATM.

Shasta, PEM is heading towards your purchase price. Are you still holding?

[shasta]

PEM is struggling ATM. There is at least one insto selling this stock and this could last for a week or two. There will be support for PEM around $3.60 though but any push below that will be bad. This time I am sitting out as there are more other attractive stock than PEM ATM.

Shasta, PEM is heading towards your purchase price. Are you still holding?

Yup im still holding & have applied a less strigent stop loss than normal for PEM.

Its to volatile to stick to a normal 5 - 10% range, i don't want to get stopped out too often!

[tricha]

Next year will be huge as long as Zinc stays up there. ;) It's not like they are short of a penny and if they stay at this price for too long, they will be gobbled up.

And stop losses Shasta, never used them as to many of my shares would have been stopped out.

[shasta]

Next year will be huge as long as Zinc stays up there. ;) It's not like they are short of a penny and if they stay at this price for too long, they will be gobbled up.

And stop losses Shasta, never used them as to many of my shares would have been stopped out.

I've never used stop losses with Uran (ASX:URA) but have "few" exceptions from this practise normally.

I take it you are hinting at ZFX sniffing around should PEM fall?

[tricha]

There heaps of potential suiters Shasta.

One of the reasons I liked them originally, take over potential, maybe they are going to take someone else over, with all the cash they kept ;)

[shasta]

There heaps of potential suiters Shasta.

One of the reasons I liked them originally, take over potential, maybe they are going to take someone else over, with all the cash they kept ;)

Any Zinc/Lead minor in there sights?

I can't think of any nearby BH - any come to mind?

[whiteheron]

I believe that PEM has been unfairly treated by the market

It has heaps of potential --- management, projects, cash, etc
And I believe that the medium term outlook for Zn and Pb is favourable

Time will tell, but I am optomistic

[shasta]

I believe that PEM has been unfairly treated by the market

It has heaps of potential --- management, projects, cash, etc
And I believe that the medium term outlook for Zn and Pb is favourable

Time will tell, but I am optomistic

WH

It has one great project & thats the problem, it needs to bring the secondary ones up to speed to "de-risk" itself.

Agree though fundamentally great company & 2008 should be a boomer.

[soulman]

However for PEM, there is nothing on the horizon to move the stock other than if there is any M/A activity. The 1st Qtr production report willl be key in Oct. I suspect PEM is being punished because other result are more spectacular and there has been a switch in money to other mid-tier mining coy such as MCR, IGO and SMY. However, if you want lead and zinc exposure, there is only a few around such as Kagara, CBH, ZFX and of course, PEM.

[shasta]

However for PEM, there is nothing on the horizon to move the stock other than if there is any M/A activity. The 1st Qtr production report willl be key in Oct. I suspect PEM is being punished because other result are more spectacular and there has been a switch in money to other mid-tier mining coy such as MCR, IGO and SMY. However, if you want lead and zinc exposure, there is only a few around such as Kagara, CBH, ZFX and of course, PEM.

Soulman

What PEM have going for them, is there smart hedging policy.

They have call options over 20% of there Zinc & 46% of there Lead out to June 2009.

Zince prices are currently below the contract prices so PEM will benefit by closing at least part of these as early as possible!

Lead prices have jumped way above the call options PEM took out on them, & i'd expect them to close out a good portion of these over the next 12 months & sell at the spot rate.

They have NO contractual obligation to sell at the call option prices, but can close them out to there benefit.

A master stroke IMO.;)

Also we have some Ore stock piled ready to sell, & around 3,800oz of Gold to sell between now & 1st Qtr 2008.

The M&A talk will persist with PEM, & with that cash lying around its not helping - but unless ZFX want them, who else would have the size & cash to do so?

[Dazza]

soul - yes i ahve sold out of MBL - sold at 5% loss, if i had waited 1 day i could have sold for break even but oh well

i missed out on the $70 ones today

but if it dips below 70 im in again , just need to buy at a better price u c, cut my losses :D

regardin PEM - good compnay eh, however ZFX i do like them....

esp with this talk about OXR mergeretc.

With PEm - good that they have sold their gold mine finally!

[tricha]

Sorry Dazza

They have not sold their Gold Mine.

They have a potential buyer who have to raise the money 1st.

[shasta]

Sorry Dazza

They have not sold their Gold Mine.

They have a potential buyer who have to raise the money 1st.

Yup the IPO is not until November...

They may as well have given away the Daisy Milano Mine...:mad:

[macduffy]

For what its worth, "Criterion" column in this morning's Australian has a Buy on PEM. Mind you, he picked it earlier this year at $5-37 an again at $4-23!

[shasta]

For what its worth, "Criterion" column in this morning's Australian has a Buy on PEM. Mind you, he picked it earlier this year at $5-37 an again at $4-23!

Macduffy

Can you post a link, or advise what paper this was in?

Thanks

[macduffy]

Macduffy

Can you post a link, or advise what paper this was in?

Thanks

Here tis

www.theaustralian.news.com.au/business/

[shasta]

Here tis

www.theaustralian.news.com.au/business/ (http://www.theaustralian.news.com.au/business/)


Cheers champ :D

[scorp57]

sorry shasta, but i'm going to have to do a 180 here.

after being bullish on zinc for 2 years, i am now very bearish on it. bad news ahead i fear. i sold out of PEM and as soon as i can pick a good time i will sell out of ZFX too.

[shasta]

sorry shasta, but i'm going to have to do a 180 here.

after being bullish on zinc for 2 years, i am now very bearish on it. bad news ahead i fear. i sold out of PEM and as soon as i can pick a good time i will sell out of ZFX too.

I'll forgive you if its for Uran? :eek:

Why the turn around, see my post earlier about there hedging position?

The lead is going great guns & will make up for any short term zinc weakness

[countryboy]

hmmm where going to produce that much in 2008! the 7000 tonn pulled last month that is stockpiled cause it is low grade won't be counted in that figure !still some efficiencies in production to be achieved but hey what i know. PEM below$4 and metal prices where they are is always gonna be a good buy. Cripes I may even dig up my own backyard !:o

[shasta]

hmmm where going to produce that much in 2008! the 7000 tonn pulled last month that is stockpiled cause it is low grade won't be counted in that figure !still some efficiencies in production to be achieved but hey what i know. PEM below$4 and metal prices where they are is always gonna be a good buy. Cripes I may even dig up my own backyard !:o

"Be greedy when others are fearful..."

I know the current economic situation has spooked a few people into selling out of good companies, but Warren Buffett looks at negative macro events as a buying opportunity, & so i am...

The SP gets a bit of a short term battering, so what? (Buy more i say :D)

The Perilya business is fundamentally sound & undervalued!

The bigger the disparity between SP & intrinsic value, the better the margin of safety IMO.

Consensus with brokers for 2008 is EPS of 88c on a ridiculously low P/E.

Unless Zinc totally bottoms out (& PEM have some hedging in place), its a no brainer.

I would only sell PEM if the fundamentals changed, so why are others bailing out due to macro events?

I could understand those traders looking for a cheaper entry price...

Who is long in PEM, outta interest?

[whiteheron]

shasta

I am long PEM and will top up with some more if the price tanks any more
Has to be good long term imo

[soulman]

Bought ZFX yesterday. Zinc prices are struggling even when all metals were up in the LME, Zinc was barely up.

The smelter asset will hopefully float soon when the market settle and the cash proceed to ZFX could be substantial. In the meantime, ZFX will not have profit contribution from the smelter operation after Aug 31st, which is a known negative. Hence, the sooner Nystar float, the better. Hopefully in November.

Shasta, WH, PEM looks to have major support at around $3.65 - $3.70. I will have to look at their 1st Qtr report before I decide to buy. Although, I was never a long term holder. I bought PEM 3 times before and on average I held them for about 4 days. I guess I was lucky with timing.

[tricha]

"Be greedy when others are fearful..."

I know the current economic situation has spooked a few people into selling out of good companies, but Warren Buffett looks at negative macro events as a buying opportunity, & so i am...

The SP gets a bit of a short term battering, so what? (Buy more i say :D)

The Perilya business is fundamentally sound & undervalued!

The bigger the disparity between SP & intrinsic value, the better the margin of safety IMO.

Consensus with brokers for 2008 is EPS of 88c on a ridiculously low P/E.

Unless Zinc totally bottoms out (& PEM have some hedging in place), its a no brainer.

I would only sell PEM if the fundamentals changed, so why are others bailing out due to macro events?

I could understand those traders looking for a cheaper entry price...

Who is long in PEM, outta interest?


1 - I'm afraid Shasta the fundamentals have changed .
The chart clearly shows this. Also what the chart does not show is the US dollar dropping as well, double whammy.

http://www.kitconet.com/charts/metals/base/spot-zinc-1y.gif (http://www.kitcometals.com/charts/zinc_historical_large.html#1year)

2 - The brokers seen so far behind reality, ? , how much will PEM earn on this lowered Zinc price, ok Lead will help comphensate a little, the lead to zinc ratio is a big difference. ( remember the US\OZ dollar ratio as well)

3 - China will become a net Zinc exporter again, I have put an articule up on the wall in front of the PC, quote Platts 26 Jan 2007, Chinese Geo's have found 16 large copper, iron, lead and zinc deposits along the Qinghai-Tibet Railway line since 1999.
Possible reserves of 10 million mt of lead and zinc.

4 - Warren Buffett looks for stocks that will be around in ten years +, not get rich fads like mining stocks that u and I love.

Do not get me wrong Shasta, Perilya is an excellent company, but while that zinc chart is still trending down ..............................................,
a little bit of caution required.

Oh and thanks for the advice on EGO, point taken and appreciated.

[shasta]

1 - I'm afraid Shasta the fundamentals have changed .
The chart clearly shows this. Also what the chart does not show is the US dollar dropping as well, double whammy.

http://www.kitconet.com/charts/metals/base/spot-zinc-1y.gif (http://www.kitcometals.com/charts/zinc_historical_large.html#1year)

2 - The brokers seen so far behind reality, ? , how much will PEM earn on this lowered Zinc price, ok Lead will help comphensate a little, the lead to zinc ratio is a big difference. ( remember the US\OZ dollar ratio as well)

3 - China will become a net Zinc exporter again, I have put an articule up on the wall in front of the PC, quote Platts 26 Jan 2007, Chinese Geo's have found 16 large copper, iron, lead and zinc deposits along the Qinghai-Tibet Railway line since 1999.
Possible reserves of 10 million mt of lead and zinc.

4 - Warren Buffett looks for stocks that will be around in ten years +, not get rich fads like mining stocks that u and I love.

Do not get me wrong Shasta, Perilya is an excellent company, but while that zinc chart is still trending down ..............................................,
a little bit of caution required.

Oh and thanks for the advice on EGO, point taken and appreciated.

Wouldnt a falling $US = more revenue in terms of $A for PEM?

[tricha]

Wouldnt a falling $US = more revenue in terms of $A for PEM?


Zinc = $1,000 a ton US, US$ = .76 OZ$ = $1375 a ton OZ

Zinc = $1,000 a ton US , US$ = .84 OZ$ = $1190 a ton OZ

and mining costs are going up in the range of 10% a year at the moment .

Get the picture :(

[tricha]

3 - China will become a net Zinc exporter again, I have put an articule up on the wall in front of the PC, quote Platts 26 Jan 2007, Chinese Geo's have found 16 large copper, iron, lead and zinc deposits along the Qinghai-Tibet Railway line since 1999.
Possible reserves of 10 million mt of lead and zinc.
Well that answers my question why the Zinc price is falling while the LME stocks are going down.
.................................................. ......

Zinc Falls on Concern China Building Stockpiles; Copper Slides

By Chanyaporn Chanjaroen
Sept. 12 (Bloomberg) -- Zinc fell in London on concern that China, the world's biggest producer of the metal, is building up larger stockpiles than disclosed by the Shanghai exchange. Copper and lead also dropped.
China probably has stockpiles of about 130,000 metric tons of zinc, more than four times the figure reported last week by the Shanghai Futures Exchange, Macquarie Bank Ltd. said in a note published yesterday. The build-up includes 100,000 tons of metal held at warehouses not monitored by the exchange as plentiful supplies of ore prompt smelters to boost output, it said.
``You've started to see a steady buildup of inventories,'' Nick Moore, a metals analyst at ABN Amro Holding NV, said today by phone from London. ``The concern for zinc is that mine and refined production is already up.''
Zinc for delivery in three months fell $30, or 1.1 percent, to $2,730 a ton as of 11:04 a.m. in London. The contract traded at a 17-month low of $2,680 a ton on Sept. 10.
The metal, mostly used by makers of galvanized steel, has fallen 35 percent this year, the most among LME-traded metals. Steelmakers including ArcelorMittal will gain from lower prices, while Apex Silver Mines Ltd., which started output at the $800- million San Cristobal mine in Bolivia, will see profit hurt.
Oversupply of zinc will reach 50,000 tons this year and 300,000 tons in 2008 as mine production grows, according to Societe Generale SA's U.K. arm.
Copper dropped $105, or 1.4 percent, to $7,370 a ton.
Workers at Southern Copper Corp., the world's fifth-largest producer of the metal, called off a strike planned for today after the company agreed to resume wage talks.
Union Talks
Employees at the smelter and Cuajone and Toquepala mines set a four-day deadline to restart discussions, smelter union General Secretary Arnaldo Oviedo said yesterday.
The metal earmarked for withdrawal from LME-registered warehouses jumped 43 percent to 11,725 tons, the highest since July 24, according to the exchange's daily stockpile report. The increase indicates more demand for the metal.
Nickel inventories tracked by the LME increased 498 tons, or 1.8 percent, to 27,744 tons, it said. The level is the highest since April 25, 2006, after more than tripling this year.
Nickel lost $200 at $26,800 a ton. Lead was $40 lower at $2,990 a ton and tin declined $50 to $15,100.
To contact the reporter on this story: Chanyaporn Chanjaroen in London at cchanjaroen@bloomberg.net (cchanjaroen@bloomberg.net)
Last Updated: September 12, 2007 06:16 EDT

[shasta]

Zinc = $1,000 a ton US, US$ = .76 OZ$ = $1375 a ton OZ

Zinc = $1,000 a ton US , US$ = .84 OZ$ = $1190 a ton OZ

and mining costs are going up in the range of 10% a year at the moment .

Get the picture :(

Ok, we're getting into semantics, as your reffering to a rising $A! :confused:

[countryboy]

In Broken Hill we mine silver lead ....and zinc.I"ll say this again the deeper you go at broken hill you pull more lead...now what is the price of lead and silver ?:rolleyes:

[shasta]

In Broken Hill we mine silver lead ....and zinc.I"ll say this again the deeper you go at broken hill you pull more lead...now what is the price of lead and silver ?:rolleyes:

Current prices...(from Perilya's website)

COMMODITY PRICES
as at 13 Sep 2007, 22:19 EST
ZINC US$/T2,760.50 +34.50
LEAD US$/T3,065.50+45.50
SILVER US$/OZ12.48-0.16
GOLD US$/OZ706.30-4.90

Lead is going berserk this year, who saw that coming? :eek:

[scorp57]

shasta- after being bullish on Zinc and PEM for such a long time, i have turned around because its simple mathematics. the zinc price at this stage looks done for. i watched the zinc price fall even whilst stockpiles were falling allthis year... now it would seem there is a supply surplus that is only going to increase.

this means a lower zinc price and this also means much lower profit for my beloved PEM and ZFX. i am still holding ZFX to see what happens with this sale, but PEM i just couldnt bare to watch...

i think PEM is a great company, but all the good things in 2008, will only see them square up i fear... but hey i could be wrong...

remember this, ZFX and PEM received an average of $3600US for each tonne of zinc last financial year. the price of zinc is now around $2700 and falling... i hope i am wrong though for my ZFX holding which is much larger than my holding in PEM was...

[Huang Chung]

Lead is going berserk this year, who saw that coming? :eek:

Actually Shasta, I think Whiteheron picked the trend very well.

[soulman]

Sold ZFX today. Hopefully I can get back in next week.

PEM is struggling and a break below $3.50 looks possible as sellers are lining up. Like I say before, there is nothin on the horizon to move the share price, and even today, while all metals are up, PEM are stagnant.

[scorp57]

ZFX i can deal with, seeing as majority of my holding was $8.50... but soulman is right, i think i will get out at a good time, divvie is still a way off yet and i wanna see what they do with all the cash from nyrstar float.

[shasta]

ZFX i can deal with, seeing as majority of my holding was $8.50... but soulman is right, i think i will get out at a good time, divvie is still a way off yet and i wanna see what they do with all the cash from nyrstar float.

How about waiting to see what PEM does with its cash?

Surely its eyeing up an aquistion?

PEM also has the sale of its remaining gold in the next quarter & the shares from the IPO of the old Daisy Milano Mine etc, as part of the settlement agreement.

In the interim the price of Zinc & to a lesser extent Lead will drive sentiment, although i don't see Zinc bombing anytime soon...

[scorp57]

shasta- ZINC has already bombed thats the thing... it is already way below not only previous highs ($4500us a tonne) but even the average prices received for last year ($3600us a tonne)

PEM will have to acheive their production increases to get the same result as last year. PEM is a great company and if it falls anymore i may consider buying back in as i am already over 10% better off at this stage, but we shall see...

[shasta]

shasta- ZINC has already bombed thats the thing... it is already way below not only previous highs ($4500us a tonne) but even the average prices received for last year ($3600us a tonne)

PEM will have to acheive their production increases to get the same result as last year. PEM is a great company and if it falls anymore i may consider buying back in as i am already over 10% better off at this stage, but we shall see...

Fair enough Scorp

Perilya is still far too cheap IMO, even if Zinc prices are falling, if its short term PEM have the hedging at higher prices to offset the potential drop.

I'm banking on Zinc stablising, but remember we are due to produce & sell far more Lead in 2008 & look what the Pb price has done over the last 12 months!

Am wondering if PEM should have kept a gold mine given the current climate & golds renewed interest on rising prices...

[shasta]

Fair enough Scorp

Perilya is still far too cheap IMO, even if Zinc prices are falling, if its short term PEM have the hedging at higher prices to offset the potential drop.

I'm banking on Zinc stablising, but remember we are due to produce & sell far more Lead in 2008 & look what the Pb price has done over the last 12 months!

Am wondering if PEM should have kept a gold mine given the current climate & golds renewed interest on rising prices...

Am nervous about this week & the zinc market in general

Looking to exit & rebuy at a cheaper price... later

[macduffy]

I'll be buying PEM, but not until the sp starts trending up.

[scorp57]

the thing that annoys me is that i watched the market live the day they hit $5.80... was around new years... and my every instinct told me i should have sold then... instead i sold a little while ago at $4.

could buy back in but i am bearish on the zinc price. if i think it may turn around, i will def buy some...

[shasta]

the thing that annoys me is that i watched the market live the day they hit $5.80... was around new years... and my every instinct told me i should have sold then... instead i sold a little while ago at $4.

could buy back in but i am bearish on the zinc price. if i think it may turn around, i will def buy some...

Same here - i got out at $3.56, as i saw the sell side getting ready to dump it below $3.50 (my stop loss).

Will buy back in when the dust settles...

[whiteheron]

Well, PEM has sure taken a battering

However, I believe that it is a very good company and that the zinc price will recover somewhat in the next 3 to 6 months

There is no possibility of me selling at under $4

Time will tell, but I am still confident of PEM reaching well over $4 , maybe up to $5 in the next year or less

It is one of a few companies that in my opinion have been very harshly treated by the market
If I am wrong I will accept that I will have egg on my face (will follow up in due course either way)

[tricha]

Be greedy when others are fearful" :D

Hmm, time for a new motto :confused:

[shasta]

Be greedy when others are fearful" :D

Hmm, time for a new motto :confused:

Duly noted

Even Shasta gets spooked occasionally (i remained fully invested when others "cashed up" during the start of the sub prime problem)

[whiteheron]

I would like to move my whiteheron photograph to the same location as your new photograph but do not know how to do this

Maybe you can provide some pointers ?

Thanks a lot

[winner69]

I would like to move my whiteheron photograph to the same location as your new photograph but do not know how to do this

Maybe you can provide some pointers ?

Thanks a lot

Go into 'Edit Avatar' in your profile

[whiteheron]

Thanks winner

I hope what I did does the trick

[winner69]

Whiteheron --- well done

[whiteheron]

I stuck my head out yesterday and purchased another parcel of PEM at $3.47
(now overweight in this company)

Just to make sure that I am comfortable with my holding I subsequently undertook a thorough review of the company, satisfying myself that all looks promising for the years ahead

I could of course be wrong as nothing to do with investing can be absolutely guaranteed
but I continue to be happy to hold

[soulman]

Whiteheron, you are sitting quite closely to the trendline. A nice bet I guess because this could be the low. A break below $3.30 would spell under $3 for PEM but if PEM holds at around $3.50 for a week or 2, this could be the start of an uptrend, assuming Zinc and Lead prices hold up.

[shasta]

I stuck my head out yesterday and purchased another parcel of PEM at $3.47
(now overweight in this company)

Just to make sure that I am comfortable with my holding I subsequently undertook a thorough review of the company, satisfying myself that all looks promising for the years ahead

I could of course be wrong as nothing to do with investing can be absolutely guaranteed
but I continue to be happy to hold

Your onto a winner in time WH, like Tricha, i got "spooked" out of PEM, but i shall return...just need the funds elsewhere at present.

I was NEVER a raging bull on Zinc, so will let it settle first.

My avatar will change to reflect the mood of the market, & the resource posters.:D

All the "doom & gloom" merchants are still worrying about a sub prime problem & not the fundamentals of businesses themselves...

[soulman]

Looks like the support level holds up for PEM. In hindsight, WhiteHeron literally bought it at the low. Now, that's timing to perfection but that's got to do with luck as well.

[whiteheron]

soulman

I only invest in companies that I have have researched and feel happy with using TA as well as FA as a sort of double insurance and try to buy as near to the low as well (dont we all)sometimes with success and sometimes without
We all have our own investing styles and that is good if whatever we do is successful
There is a degree of skill involved but also a degree of luck in every transaction

Back to PEM
Although I managed my last purchase at very close to the bottom (if in fact it was and only time will disclose that)
I have purchased other parcels of PEM earlier at what I thought was the bottom at the time but subsequently proved not to be
In fact by combined PEM holding is still a very small amount below its current market value

Time and experience (sometimes bad as well as good) tends to hone ones skills but it is still challenging to get it right a high proportion of the time, however, this is a challenge that makes this game so interesting

I must say that buying at or near the bottom is for me much easier than selling at or near the top, a skill that seems to have eluded me thus far
Sometimes I can manage it but I still have much to do to nail it ,that is if this is possible

[duncan macgregor]

WHITEHERON, It is equally as easy or as difficult to bottom buy as it is to top sell. Top selling you just raise your stop loss level up at your perceived level of risk, with commodity price charts, plus market sentiment. At the bottom end you work it out with a similar system in reverse. It is amazing how lucky you can become with a little bit of practice.
Market perception first, commodoty prices second, then company fundamentals third is what to look for in that order. Have a flexible stop loss, and stock buy, you will find out it is not to hard to be lucky most of the time. Macdunk

[Shrewd Crude]

whiteheron,
you said, "nothing is guaranteed in investing"
I can think of one stock that we both hold that looked and looks guaranteed...
:cool:
.^sc

[soulman]

Whiteheron, I bought PEM twice in the last month and both times bought at $3.80 and sold at just over $4 before their result. After their result, I was dissapointed with their dividend payment as I thought anything over 4 cents would signalled confidence but it was a mere 1 cent. So, I never venture into PEM again and will probably sit out until their 1st Qtr Activity report.

It's true that we can never time the top and bottom but anything close to it is good enough. In anyway, long-term works everytime. Example (excluding dividends) = ASX 12 fold in 9 years, MBL 15 fold in 11 years, WOW 15 fold in 15 years. There are many more, including miners like MCR, SMY, FMG, ZFX. Actually heaps more. Long-term holder are the real winner but traders might argue against that.

[shasta]

I sell PEM at $3.56, & 2 days later its $3.85, go figure?

Has Zinc prices fundamentally changed over the last 2 days?

I mean the very people picking Zinc as the top metal for 2007 etc, are bearish on it now...

What is the driving force behind PEM & the volatility?

[whiteheron]

Thanks for the useful and informative replies folks
I have taken them on board

As far as selling at the best price is concerned, maybe I am just a mean old bugger who tries to squeese the last drop where a bit less is usually still a good deal !

Most purchases/sales do not of course take place at the bottom or the top but at some point in between

[steve fleming]

Nice buying today - for a non-settlement day.

PEM now approx 25% off its lows, and IMO still represents one of the best value buys on the ASX200.

[steve fleming]

Huntley upgrades for Zn and Pb today:

1) LEAD

We increase our long term lead price forecast 56% from US$0.41/lb to US$0.65/lb. In A$ terms our forecast rises 48% to $0.80/lb, ahead of the five year average of $0.66/lb. Lead has risen to record US$1.60/lb levels as LME stockpiles reach a 17 year low of 21,000t. Battery producers traditionally stock up now prior to the peak northern hemisphere winter demand. A lead poisoning scare at Ivernia's Magellan mine in WA suspended exports in March. The mine produces around 3% of global output. We believe the outlook for lead is bright with the dampening effect of the removal of lead additives from petrol in the 1980's and 1990's now fully worked through. The positive influence from the increasing number and size of batteries in cars is now driving demand and prices. Lead is generally a late comer but a ‘stronger for longer’ metal in metal price upswings. Just think about all those extra cars being added each week in Beijing, let alone motor scooters/bikes in India!

2) ZINC

We raise our long term zinc price from US$0.70/lb to US$0.90/ln. In A$ terms, the forecast rises 22% to $1.12/lb, in line with the five year average. Production costs have fundamentally moved up in the last five years. Demand for zinc in galvanising applications remains strong, particularly in China. There are some concerns that the market will move into surplus next year with a number of new mines coming on or restarting San Cristobal is the largest and will add about 2% to global supply. China is investing heavily in zinc mining and smelting. A partial offset, Chinese government crackdowns on pollution have reduced some smelting capacity. Current low LME stockpiles of 60,000t compare to 90,000t in December when zinc prices were +US$2.00/lb. Any near term supply hiccups could see a sharp rally.

[scorp57]

zinc is still way off its highs... and with stockpiles at near record lows, it really does not make sense... except the market is factoring a future supply surplus... hence why i said earlier that fundamentally i was bearish, because the zinc price is extremely low compared to falling stockpiles but this hasnt changed all year so far and i dont see it changing in the future... unless there is an extreme fall in stockpiles...

i still have a huge holding in ZFX i only sold my PEM at $4.10 a while back now because i got them at $2.70 and traded them into more URA at 25c