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Sold Rio; Jump on the BHP Buillitrain

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Well Rio is officially super-expensive, I do not touch stocks with a P/E of 25, I sold it off at $135, it felt crushing to see it surge to $150 today ... but hey, I'm the one who called on Rio as the best stock to invest in!

BHP is getting extremely cheap and these prices are just irresistible.

The worlds biggest miner is just on a P/E of 16, Rio is at a staggering 25, imo its suicidal to make a bet on Rio unless you love lottery tickets.

BHP introduced a sweetener today, a $30b buyback should they agree for a merge, but its not enough for Rio.

I think BHP will launch another bid, but its just too risky to buy it at such a price, and whats the most it can do, probably $160-$200? And if it falls it'll slide to a $100.

Should the bid fail or not pass competition regulators then people will pull out of Rio and restore their stakes in BHP again, BHP is at a ridiculous discount!

I've bought at $44, $43, $42 and $41.50, I hope it falls down to $38.50 where there is some heavy support, but even then it's still a fantastic buy!
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  1. frosty's Avatar
    hope your right i brought BHP for 4350and 4250 last week lets hopeit goes back up to 4700!
  2. vishalt's Avatar
    I see no reason why it shouldn't, a broker I read in the Fin Review says $55+, most analysts I spoke to at work say this is an easy buying opportunity.

    Just hold on and don't buy big, I wouldn't be surprised if it falls a bit more to those support points on my chart.


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