Trading is not a game of exacts. Perfectionists need not apply. Markets are made up of many irration...
...and Other Mining Matters
12/02/2005 12:00 am EST
South Africa is not the only global home to mining operations. Here, a variety of experts- Beth Gaston Moon, the Aden sisters, Larry Edelson, and Mark Leibovit , look around the globe for the best mining operations. Here are favorites from Peru to Australia.
(For more on the advisors cited below, please click on their photos.)
"Companhia Vale do Rio Doce (RIO NYSE) is the top miner of iron ore in the world," says Beth Gaston Moon, analyst with Schaeffer's Investment Research. "The company also produces potash, manganese, aluminum, and a variety of other substances. RIO has worked its way higher for much of 2005, rallying more than 80% from its late-April low. Technically, the shares are working to overcome potential double-top resistance at the 44 level, which had marked a peak in the stock price in late September. Options players are gathered in the bearish camp and the resultant Schaeffer's put/call open interest ratio of 1.45 is higher than all but 1% of all readings taken during the past year. As this skepticism wanes, increased buying pressure should buoy the shares even higher. Wall Street isn't terribly invested in RIO, as there are currently only six brokerage firms that are covering the shares. Any additional coverage could be a boon for the company."
"China's surging demand for raw materials shows no signs of faltering," says Pamela and Mary Anne Aden, in The Aden Forecast. "Within this sector, our two favorite companies are Australia's giant BHP Billiton (BHP NYSE) and London-based Rio Tinto (RTP NYSE). Both companies are producing iron ore at a brisk pace and both plan to expand more iron ore capacity. In our opinion, buying and holding these mining companies is an excellent way to stay invested in the ongoing bull market in raw materials."RTP NYSE) is also a top pick from Larry Edelson in The Real Wealth Report . He explains, "The company plans to expand its alumina operations and double its capacity to 600,000 metric tons a year. Aluminum prices are at record highs. This should bring in some massive profits from China and other red hot Asian markets that have driven up prices of the metal to ten-year highs.Also, Rio Tinto is a major provider of uranium, and uranium prices are expected to more than double over the next five years. Demand is surging and Russia is boosting its consumption of uranium and cutting back on its sales. Also, China wants to build two nuclear power reactors a year to meet the country's energy needs. And India is building another eight reactors to boost its electricity generating capacity. Rio Tinto is set to benefit from all of this."
Technical analyst Mark Leibovit, editor of the active trading service, VR Survey, "Companies de Minas Buenaventura (BVN NYSE), based in Peru, has formed a Positive Volume Reversal after pulling back to its 50-day moving average," "We think it has good upside potential especially with the longer term strength we see in gold and gold shares.Compania de Minas operates as a mining company, producing precious metals and holding mining rights in Peru. The company also owns an electric power distribution company and a mining engineering services consulting company. Compania de Minas Buenaventura was established in 1953 and is based in Lima, Peru. The stock is a buy at market with a stop below the October 19 low at 27.43. We are looking for an upside target price of 34."
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