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Project MAKE MONEY from BHP!

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BHP has fallen around 15% from its all-time highs now so it presents a good opportunity.

I'll just reinterate that this stock is the worlds biggest miner, it has all the fundamentals behind it like the Australian Cricket Team.

The world's biggest copper mine in Chille, Olympic Dam, Pilbara Iron Ore with its own rail line, plenty of other Zinc/Aluminum/Coal mines/projects and its bloody big petroleum division.

Is there any reason why this stock should fundamentally perform bad? No!

If you're worried about BHP going down I suggest you not look at the computer screen for several weeks/months, its extremely natural for predator stocks to go down when they make a bid.

There's no doubt that its takeover for Rio would be an expensive one, but just think about the upside it would have? Rio's big mines, Alcan, more Pilbara, Ranger mine.

A merge between BHP and Rio will take a year and could get knocked back by the EU, and I seriously doubt investors will focus on it too much till it passes all regulatory approvals.

BHP's P/E has fallen to around 14, almost 10% below the market and sectors average P/E of 16.

This is free money!

I keep topping up at the lines on my charts and I've also shorted 10% of the capital I have long - to the British variant of Billiton, which I've shorted to make money while the stock continues to fall in the short-term.

ALUE Company All Ords Sector
P/E ratio 14.78 16.45 15.42

Earnings and Dividends Forecast (cents per share)
2007 2008 2009 2010
EPS 275.0 302.9 347.2 311.5
DPS 55.4 62.0 73.3 76.8
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  1. overule's Avatar
    Interesting and i firmly believe BHP will perform well in the long term.

    How much more do you think BHP will fall ? I am looking forward to be filling up anytime next week.
  2. vishalt's Avatar
    I'd say this is a pretty good price, its almost $8 or around 20% from all-time highs, I wouldn't be surprised if it goes down to $38 and I'd also be ready to have enough capital to buy more down $32, really doubtful but you always have to be ready!

    (Hence me shorting the UK BHP)

    The brokers still have good targets, rumours of a Rio counter-bid, extremely strong fundamentals, and some of the signals my Dad uses encouraged him to buy today, so we're going on a joint venture of massing BHP ;D.
  3. vishalt's Avatar
    I've bought more, its hit $40, pretty nice discount.

    I've added more shorts to the British "BHP Billiton plc" to hedge and make money during the down fall.

    I'm hoping this is the bottom but obviously a good trader thinks ahead and I'm ready to tackle it if it comes down to $38 or even $36.


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