Mish's Global Economic Trend Analysis Message Board

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Strategies & Market Trends : Mish's Global Economic Trend Analysis

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To: russwinter who wrote (13194)	10/9/2004 10:51:05 AM
From: orkrious	Read Replies (1) of 116555

russ, what I am wondering is with copper inventories essentially at zero, will the bust cause demand to drop so much that prices fall enough to make the stocks unattractive. last qtr with copper at $1.21 and gold at $388 NTO made 3 cents CDN. They made 11 cents in the last six months. so they are roughly at 15x income based on the last six months, and they should really be valued based on cash flow (they sell for 5x EBITDA and Alumbrera is now debt free) and reserves (Aqua Rica is enormous). last Q sixty-three percent of their sales were copper, 37% gold. with world copper stock at essetially zero, in the bust will copper prices fall more than gold prices will rise? and even if they fall, will they fall much below $1.21? the hard question is will NTO get creamed in the bust? I don't care if it falls 20%. the best I might do trying to get out at the top and in at the bottom might be 10%. is it worth it when it might just keep going? after all, the gold stocks have already had their correction, and NTO is more than 1/3 gold. thoughts?

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