OZ Minerals

[Daytr]

I used to deal with these guys, always found them very conservative & they used to frustrate me.
However they typically deliver albeit they have had the odd glitch.
One of the few independent good sized copper plays in Australia & reasonable gold production as well.
Debt free with I think $150M or so in the bank.
Standby debt facility of $200M.
Market cap around $900M.
Costs should have reduced as they are a fairly substantial diesel consumer.
Copper on the bounce by looks, gold soaring & Aussie behaving.
Picked some up Friday just above $3, should be a good start after both copper & gold are up Friday night.

[Daytr]

Flicked out at $3.40 and went short yesterday after down grade to world growth.
Not hugely bearish, I just think the hedgies are going to have another crack at copper to the downside.

[Daytr]

Much stronger quarterly than I anticipated.
Weakness in copper price being offset by stronger gold & lower Aussie.
Closed out my short for small loss & have gone long.
I do like the long term prospects of suite of projects for development.
Also like the relationship they have formed with the SA government.
SA when I was there were doing a huge push in the resources sector & wanted to take on Perth as a mining city.
Long time before they can claim that mantle but they are certainly supportive to the resources sector as a whole.

[macduffy]

Various brokers' comments on OZL. Generally positive.

http://sharecafe.com.au/sharecafe.as...291&symbol=OZL

[Daytr]

Yeah I think it is now getting a bit pricey here.
Obviously copper will dictate, but they also do have quite a gold & AUD kicker.
Not sure I'm that bullish on copper.
Not hugely bearish either mind you, but there has been a bit of production curtailed due to current prices that can be quickly turned back on.
BHP have highlighted they want to produce more copper.
Plenty of large projects on the radar.
Demand should continue to be strongish at least.
I suspect we may see lower CU prices yet before we get a recovery.
Sub $5k/ton quite possible and some are calling for $2/lb or $4500/ton.

[h2so4]

Yeah I think it is now getting a bit pricey here.
Obviously copper will dictate, but they also do have quite a gold & AUD kicker.
Not sure I'm that bullish on copper.
Not hugely bearish either mind you, but there has been a bit of production curtailed due to current prices that can be quickly turned back on.
BHP have highlighted they want to produce more copper.
Plenty of large projects on the radar.
Demand should continue to be strongish at least.
I suspect we may see lower CU prices yet before we get a recovery.
Sub $5k/ton quite possible and some are calling for $2/lb or $4500/ton.

$2 is very low........sub inflation adjusted price which I calculated at $2.80. I'm very happy buying at this price. And why buy copper when you can buy a producer at a low price. It's a steal. Read the copper company thread.....it still applies nothing has changed.

[Daytr]

Was it low at $3.05 2 weeks ago or low now at $3.90?
I wasn't suggesting buying copper, but by buying OZL you almost may as well be.

[h2so4]

Was it low at $3.05 2 weeks ago or low now at $3.90?
I wasn't suggesting buying copper, but by buying OZL you almost may as well be.

Well you work it out. 440kt @$2.50lb=$2.2b US plus .61mt gold. Now these are proved reserves.
Cash $154.9m
Debt nil
20% stake in SFR
Market Cap @ 3.90 = $1.18b

Didn't get as far as cash flow but that's low isn't it?

[h2so4]

$4500/ton= $2.25lb

[Daytr]

Yes but that's sales revenue, which mean bugger all.
You have to remove costs.
Historically they are cheap, however that is because copper was a lot higher & the expectation was it was going higher still.
That's not the view right now.
Sentiment & copper price will see OZL back at better levels imho.