BMG - BRAZILIAN METALS GROUP Iron Ore

[drillfix]

Hi Folks,

I picked this stock for the stock picking comp but never did buy any as my entry price never seemed to get hit (too low).

But today, its now trading EX rights so a sell off is on so IMO, a good time to do some shopping, as it seems its being dumped from those who bought it up to take the entitlement at much much higher prices to get free otpions. Keep in mind also the sell off of the ASX that is also going on.

Will post some stats for the Co a little bit later but no doubt some of you may already know about this stock in which case I welcome your posts.

[shasta]

Hi Folks,

I picked this stock for the stock picking comp but never did buy any as my entry price never seemed to get hit (too low).

But today, its now trading EX rights so a sell off is on so IMO, a good time to do some shopping, as it seems its being dumped from those who bought it up to take the entitlement at much much higher prices to get free otpions. Keep in mind also the sell off of the ASX that is also going on.

Will post some stats for the Co a little bit later but no doubt some of you may already know about this stock in which case I welcome your posts.

Whats tickled your fancy with this Drilly, the chart or Iron Ore in Brazil?

[drillfix]

A friend of mine told me about this stock among a few other stocks that I put on a watch list and monitored.

Previously missed the boat with entry as I dont like chasing stocks though it did quite a nice run and then gave some loyalty options which I also missed but due to the dispatch notice of these, it is now being sold off due to the stock going EX

So you have all your loyal (not) folks selling it off which to me, offers a nice entry price (which atm suits me)

So what I fancy is, not that many shares issued atm.
Ex FMG technical services manager
SP has just plummited offering nice entry for both LT holding stock and some trading stock.
Some results due to out or anticipated in the near term
Co also has some U tenements in Chile which they will hold and partner with.
Some exposure into South America (Brazil etc) so lots potentially also going on.

These are just a few, but the Chart to me is neither here or there, but looking oversold at present.

Would like to hear a FA breakdown of the Co from the Eyes of the great Shasta who is the master Company Breakerdowner'er :)

[drillfix]

Whats tickled your fancy with this Drilly, the chart or Iron Ore in Brazil?


Shasta, I forgot to mention this also.

Eventually the Free Options will hit the market, many folks are bailing out on this stock and the Free Options will trade for pittance. (hopefully).

I think they are 20c strike options which is close to where the share price is now (22c) so when they come online, stacks of folks will be wanting to pick them up or accumulate them at as low as possible, so of course, who wouldn't want them as low as possible.

Dont know how much they will hit the market at, but I will detect an eventual rush for the door to either to eventually buy them. IMO

But then, it also depends on how global markets are also panning out. (which really goes for every stock anyone talks about).

Now lastly, some drilling results will or should be coming out too as they are expected around the time or close to the option release time so this makes for some interesting times/trading/investing for BMG & I encourage you, and other ST readers here to follow this potential move as this upcoming options buying opportunity comes our way, as well as the fully paid shares which have also been smashed back down due to this which will and should also rally back as demand for the options unfolds (lets not forget about the results also).

More food for thought anyway.

[shasta]

Shasta, I forgot to mention this also.

Eventually the Free Options will hit the market, many folks are bailing out on this stock and the Free Options will trade for pittance. (hopefully).

I think they are 20c strike options which is close to where the share price is now (22c) so when they come online, stacks of folks will be wanting to pick them up or accumulate them at as low as possible, so of course, who wouldn't want them as low as possible.

Dont know how much they will hit the market at, but I will detect an eventual rush for the door to either to eventually buy them. IMO

But then, it also depends on how global markets are also panning out. (which really goes for every stock anyone talks about).

Now lastly, some drilling results will or should be coming out too as they are expected around the time or close to the option release time so this makes for some interesting times/trading/investing for BMG & I encourage you, and other ST readers here to follow this potential move as this upcoming options buying opportunity comes our way, as well as the fully paid shares which have also been smashed back down due to this which will and should also rally back as demand for the options unfolds (lets not forget about the results also).

More food for thought anyway.

I'll have a dig into them & see if i like what i find.

I am looking for exposure to Iron Ore & Coal, but might just stick to the bigger companies in AQA & NHC repectively

Will posts later tonight

[drillfix]

Cheers Shasta, appreciate any input you can give, for the good or the bad.

[shasta]

Cheers Shasta, appreciate any input you can give, for the good or the bad.

I too also like the Brazil factor, especially as i see Brazil, Russia, India, China ("BRIC") being important to underline the global economy whilst the "West" languishes in debt.

What i like...

Some nearby developed permits have been sold for large upfront amounts, yet the payments for Rio Pardo are staged over 5 years - nice agreement

Fe grades seem pretty good to me, up to 68% & estimated Opex costs < $US30/T

Cash @ 31/12 of $7.6m - to fund the agressive drilling program for a JORC resource by mid year

Top 20 own ~68% (incl 2 x 10%+ shareholders)

BMG would be set to reap around $29m from the Mar 2014 20c options

Approx half the FPO's are escrowed (cant seem to find if its voluntary & the actual period, im assuming 12/24 months), which keeps the register tight

What i dont like...

Capex @ ~$US2.8b, especially being 160km away from the yet to be completed rail line back onto the main railway link

Shareholders will have to stump up with more cash to pay the total $US59m acquistion cost over the 6 years, incl $US5m in July

[drillfix]

Thanks heaps once again Shasta!

I am starting to sound like a dvd skipping but I really do appreciate your efforts you put forward to help others, including myself.

Some good points re-rail and acquisition costs, never actually thought about that, along with a few other unknown things one misses when viewing a stock.

Also, I feel Brazil gives a bit of what I call some Political Redundancy to the rest of the globe so plenty to build on over there. imo.

Thanks again Shasta~!

[shasta]

Thanks heaps once again Shasta!

I am starting to sound like a dvd skipping but I really do appreciate your efforts you put forward to help others, including myself.

Some good points re-rail and acquisition costs, never actually thought about that, along with a few other unknown things one misses when viewing a stock.

Also, I feel Brazil gives a bit of what I call some Political Redundancy to the rest of the globe so plenty to build on over there. imo.

Thanks again Shasta~!

No worries, it doesn't take me very long to assess stocks - each day i probably find about 20 companies of interest, which drops to 5 or 6 after further review (if theres anything i dont like about it, i end the research), & maybe 1 or 2 a week makes it onto the Low EV list

South America seems to be the new resource "hotspot", as you know GRM has a silver project in Mexico which interests both JBMurc & I - no riskier than Gold, Coal or Iron Ore in Africa, in y opinion - Brazil is fairy stable & pro mining, with reasonable fiscal terms

[drillfix]

I think with this stock, it is now becoming a competition to see who can eventually buy the new 52 week low that keeps getting set until the options come online and a slow frenzy builds up.

As usual, time will tell.

[drillfix]

Thats it, I am out.

I am not really a Fundamentals type of guy, but the way I read this ann, it reads poor so I licked my little wounds and decided to exit with whatever small loss and re evaluate later.

There seems to be some promise with this co, but whatever it is that drew me here does not seem to be working.

Is it just me, or was there something in today's Ann that was special?

Ann:
http://imagesignal.comsec.com.au/asxdata/20110308/pdf/01159350.pdf

[shasta]

Thats it, I am out.

I am not really a Fundamentals type of guy, but the way I read this ann, it reads poor so I licked my little wounds and decided to exit with whatever small loss and re evaluate later.

There seems to be some promise with this co, but whatever it is that drew me here does not seem to be working.

Is it just me, or was there something in today's Ann that was special?

Ann:
http://imagesignal.comsec.com.au/asxdata/20110308/pdf/01159350.pdf

The Fe grades are quite low, but i'll post the bit i did like from the ann...

Extract...

Beneficiation tests published by Honbridge indicate that the ROM feed material at grade of around 19%
to 20% could readily be upgraded to pellet feed grades of 65% Fe for an estimated process operating
cost of US$8.85.

[drillfix]

The Fe grades are quite low, but i'll post the bit i did like from the ann...

Extract...

Beneficiation tests published by Honbridge indicate that the ROM feed material at grade of around 19%
to 20% could readily be upgraded to pellet feed grades of 65% Fe for an estimated process operating
cost of US$8.85.

Well spotted shasta, I kinda skimmed that but the beatification process although I know about it is not really something that I confess that I am no expert but I would have thought the published grades to be a bit more higher as I dont fully quite understand how they will get 20% into 65% pellet grade.

Guess I will learn this along the way, although from reading and following PLV there is an example to refer to right there.

[shasta]

Well spotted shasta, I kinda skimmed that but the beatification process although I know about it is not really something that I confess that I am no expert but I would have thought the published grades to be a bit more higher as I dont fully quite understand how they will get 20% into 65% pellet grade.

Guess I will learn this along the way, although from reading and following PLV there is an example to refer to right there.

BMG looks like its been out for a jog, Drilling results Drillfix?

[drillfix]

BMG looks like its been out for a jog, Drilling results Drillfix?


Hi Shasta,

Yeah I think the stock had bottomed there for a while, and shucks, moved my order from 12c to 11c to 10.5c which means I would have had 2 fills, yet at the time, it appeared to be not stopping from a fall, so by seeing the buy volume previously building upon 10c to me seems to show the floor/support zone.

Not gonna chase it though, maybe an incremental move to catch whatever potential drifts there may be but the chart is looking set on the daily for with Williams, MACD signal and histogram getting primed, RSI strengthening up, and a tad of OBV turning its head up, Yet the hourly does not seem to agree at present though the a jump across the 13ema is a nice signal, a couple of more hours and I may get back in.

Results? Well, there had been some previously yet the market never seemed to care much. There was a couple of trades and then back down and the Ann went unnoticed at the time.

Dont know if or when the next results will be but some of the freebee options will hit the market at some stage and I will be keen on seeing what happens there.

In them meantime, I just watch and wait , as with quite a few other stocks as well.

[drillfix]

BMG looks like its been out for a jog, Drilling results Drillfix?

Hi Shasta,

Here is a chart for BMG, although there is not much data to go with this chart so I forgive the chart, however price has now popped its head up through the 13ema line so we could see a little bit of a run. Has this started due to more news being anticipated? Dunno, but I took a small position only so I cant get hurt either way.

Plus, I remember nearly buying this stock in the mid 30's after missing out at 20+c previously ended up chasing it and then said nahhh, let it go.

Here is the chart: BMG daily and weekly >>> http://www.imageurlhost.com/images/pempg3690udtyyuhgx4a.png

Again, not much of a chart, but no doubt it should get better, and bugga that I let the low go but Im not concerned about picking lows, but more so catching a ride to what I feel will at least be 22c where the fall from the 30's took it too originally. (plus I caught a knife there, but took cleverly took a small loss realising it was a mistake).

Lets see some results BMG.

[shasta]

Hi Shasta,

Here is a chart for BMG, although there is not much data to go with this chart so I forgive the chart, however price has now popped its head up through the 13ema line so we could see a little bit of a run. Has this started due to more news being anticipated? Dunno, but I took a small position only so I cant get hurt either way.

Plus, I remember nearly buying this stock in the mid 30's after missing out at 20+c previously ended up chasing it and then said nahhh, let it go.

Here is the chart: BMG daily and weekly >>> http://www.imageurlhost.com/images/pempg3690udtyyuhgx4a.png

Again, not much of a chart, but no doubt it should get better, and bugga that I let the low go but Im not concerned about picking lows, but more so catching a ride to what I feel will at least be 22c where the fall from the 30's took it too originally. (plus I caught a knife there, but took cleverly took a small loss realising it was a mistake).

Lets see some results BMG.

Those short term charts are wasted on me Drilly, i view free charts using candlesticks & im interested in the longer term indicators, + RSI when oversold

I dont chase stocks either, if a LOW EV company rocks on thru the $20m M Cap, it goes off the list (unless the EV is compelling enough to keep on watch)

[drillfix]

Those short term charts are wasted on me Drilly, i view free charts using candlesticks & im interested in the longer term indicators, + RSI when oversold

I dont chase stocks either, if a LOW EV company rocks on thru the $20m M Cap, it goes off the list (unless the EV is compelling enough to keep on watch)


Awe Shasts, I would not say that. The chart that I previously posted was a bit of a waste for everyone really because the PRT application does not consolidate the prevous data which makes it difficult to get a TA picture over stocks that change names, Codes or whatever.

This was also part of the problem that I had with PRT when I subscribed paying real good money for accurate data, and many of the times I was only getting ****e back from some stocks.

No discredit to their charting application though, I believe its fantastic, its bliss for many things it does and what you can do, and I encourage other users of other platforms such as IC or whatever charts to still sign up and use the EOD data for free with PRT as you will discover another world.


Back to BMG though.

I took a snap shot of the Daily Chart which shows a bit more detail for the TA side of things for BMG.

Here is a daily chart of BMG >>> http://www.imageurlhost.com/images/j6cxg2zfkyyfqver3o04.png


As you can see, some easy not hard to follow buy signals drawn by boxes on the chart.

See what happened the last time this stock crossed and went above the 13 ema line (light blue)??? Well it ran from 11c up to 40c and never looked back not once.

The frequency of that type of event does not happen often, but saying this there is great deal of market conditions also governing stocks these days as we climb back up the ladder of XAO to test new highs so as with any stock anything can happen until the overall direction is clear.

Some good news and our Brazilian Explorer will have some new Legs to run with IMO.

TA positives are:

MACD signal line cross
MACD histogram increasing
DMI crossover
Williams %R showing overbought but can remain there for a plentiful period.
RSI rising and now over 40+
OBV also rising

PSAR confirming new up trend direction
13 EMA breached by price candles 3 times and rising

60 min chart is now also trending upward with price above (on top of) the 13 ema (not pictured).


Fundamentals

Ask Shasta as he is king of Fundamentals :P

But my brief is Further Updates will come BMG's RIO Pardo Iron Project and there is only a small amount of shares issued being approx 73,854,932 million shares on issue with previous FMG crew onboard as well.


So,
What you reckon folks. Have a think, look and a read over the weekend hey and let us know your thoughts. I like the stock personally, and in due time like many stocks will hopefully provide favourable results, but sound off and let us know your thoughts or shoot it straight to me if you think I am barking up the wrong tree here as I would appreciate that too, but I do not believe I am.

[shasta]

Awe Shasts, I would not say that. The chart that I previously posted was a bit of a waste for everyone really because the PRT application does not consolidate the prevous data which makes it difficult to get a TA picture over stocks that change names, Codes or whatever.

This was also part of the problem that I had with PRT when I subscribed paying real good money for accurate data, and many of the times I was only getting ****e back from some stocks.

No discredit to their charting application though, I believe its fantastic, its bliss for many things it does and what you can do, and I encourage other users of other platforms such as IC or whatever charts to still sign up and use the EOD data for free with PRT as you will discover another world.


Back to BMG though.

I took a snap shot of the Daily Chart which shows a bit more detail for the TA side of things for BMG.

Here is a daily chart of BMG >>> http://www.imageurlhost.com/images/j6cxg2zfkyyfqver3o04.png


As you can see, some easy not hard to follow buy signals drawn by boxes on the chart.

See what happened the last time this stock crossed and went above the 13 ema line (light blue)??? Well it ran from 11c up to 40c and never looked back not once.

The frequency of that type of event does not happen often, but saying this there is great deal of market conditions also governing stocks these days as we climb back up the ladder of XAO to test new highs so as with any stock anything can happen until the overall direction is clear.

Some good news and our Brazilian Explorer will have some new Legs to run with IMO.

TA positives are:

MACD signal line cross
MACD histogram increasing
DMI crossover
Williams %R showing overbought but can remain there for a plentiful period.
RSI rising and now over 40+
OBV also rising

PSAR confirming new up trend direction
13 EMA breached by price candles 3 times and rising

60 min chart is now also trending upward with price above (on top of) the 13 ema (not pictured).


Fundamentals

Ask Shasta as he is king of Fundamentals :P

But my brief is Further Updates will come BMG's RIO Pardo Iron Project and there is only a small amount of shares issued being approx 73,854,932 million shares on issue with previous FMG crew onboard as well.


So,
What you reckon folks. Have a think, look and a read over the weekend hey and let us know your thoughts. I like the stock personally, and in due time like many stocks will hopefully provide favourable results, but sound off and let us know your thoughts or shoot it straight to me if you think I am barking up the wrong tree here as I would appreciate that too, but I do not believe I am.

Im certainly not that well versed in Iron Ore, but what people need to realise is the extent of rail work required to link back up with the main trunk line, we are talking 160km, & that wont be cheap, unless they can form a consortium to fund it or Govt helps out (wouldnt think so as the project isnt large enough to have "special project status"), they are probably going to shore up the resource to on sell it, as has happened to other permits around them

[drillfix]

but what people need to realise is the extent of rail work required to link back up with the main trunk line, we are talking 160km, & that wont be cheap

Shasta, very good point, but then we are not talking about Australia, or quite a western labour costs as such. You have labour which is at a fraction of Aus wages plus 160 KM is not that far really, not compared to some of these projects over here in Aus like WA whereby BHP rail it right up many many 100's of KM if not further in some instances.

Also, talk of rail is still early days yet important to take into consideration, but in the meantime there still remains plenty of drilling and resource to prove up so any significant strike or surprises may help things along as well but again, early days, for everything with this company.

[corporateraider]

I didn't get too excited when I read the latest drilling results. Yes the strikes have been from surface, but the grade is low (17%) and the thickness of ore is low.
The conceptual target seems to be around 2bill tonnes.
To me the determinant of whether this is economic is how the size of the ore body relates to the capital cost. Brazilian labour costs will help, but that would seem to be a fraction of the rail development cost,
In OZ probably IRD is the best comparison in terms of grade and ther conceptual target is way bigger.
Ease (cost) of benefication is also a significant factor.
On the plus side maket cap is only 13m.

[drillfix]

Good post CR,

Thats the extra stuff on the fundamentals I like to hear. But also on the FA side of things, its early days so in the meantime, I will follow the TA and also any posts that come along to this thread to those that have got something to fundamentally say about BMG.

Thnx again~!

[drillfix]

Have decided to exit out at 16.5 with break even to rethink both fundamentally, plus technically showing a tad of divergence with OBV and RSI as well as DMI.

Will take another look a little later on this one folks.