Top miner BHP Billiton , bidding for rival Rio Tinto in what would be the world's second-biggest takeover , posted a 12.4 percent rise in full-year net profit to a record $15.4 billion , as Chinese demand stoked a commodities boom.
Year-to-end-June net profit was up from $13.4 billion the previous year and in line with analysts' forecast.
Shares in BHP, the world's biggest mining company , have fallen 5.4 percent this year to Friday's close, outperforming Australia's S&P/ASX 200 resources sector subindex , which is off 9 percent.
Eoin Treacy of Fullermoney says that as commodities prices weaken, you need to look carefully before investing.
Q. Eoin, I've read that China's annual consumption of copper has declined from a 28.66% growth rate to 2.4%. What does that mean for continued growth in China and also for the global copper market?
A. China and indeed much of Asia and the Middle East are in a generational-long period where they have to build infrastructure from the ground...
When it comes to the worldwide metals market, gold may get all of the attention but other, more durable, metals such as steel and iron have proved to be much more profitable. For instance, the price of gold is actually down 2% from mid-January, but steel prices are 50% higher.
I love this company. I'm betting that some big caps like BHP are going to merge with other ones or split into mini big core commodity plays to achieve better synergies with uptick in individual commodities.
Anyway, commodities will take a breather in the second half of 2008 (read after Beijing Olympics) and perhaps into first quarter 2009, then regain their upswing for another long bull.
You could wait till the second half to get better deals with companies like BHP but in either case you can't go wrong with best of breed companies.
So the cat's out of the bag as far as energy and raw materials being the hot thing to own. BHP enjoy the vast plains of australia to dig away in and have mining operations all over the world. The company grows through M&A and have delivered outstanding performance over time, always better than the sector or the competition. Add to that insistent roomers that China is trying to buy into the company and what you get is a traders heaven.. enjoy.
TheStreet.com's Jim Cramer says that rebuilding from natural disasters can alter the growth picture for a country.
Is it Katrina all over again? Or is it bigger? Much bigger? That's what I am thinking about this Chinese earthquake.
Katrina distorted the U.S.'s growth pattern for more than a full year. The raw materials, the effort, the work, the reconstruction affected businesses from small-scale ret...
"A once in a lifetime super bull market in commodities is underway," note resource experts Mary Anne and Pamela Aden. Here, the advisors look at some favorite commodity stocks in their The Aden Forecast.
"Commodities are in a mega super rise is because of the dramatic changes in the global economy. The rise that started in commodities in 2001 has continued to expand over the years and we believe the upmove is just warming up and it has years to run.
3/21 - "Already the world’s biggest mining and petroleum company with a market cap in the $180-billion range,, Australia’s BHP would be better off on its own, says Tony Robson of BMO Capital Markets. He initiated coverage of the company with an “outperform” rating and a target of A$45 on Wednesday, but insisted that BHP is overpriced when compared to its peers and may fall if its takeover bid fails."
"While prospects for wealth destruction remain, given the possibility of a higher bid for Rio, BHP shares are nonetheless attractive, Mr. Robson said in a report. He estimates the merged entit...
As the South Korean, Japanese and Chinese prepare for the next round of iron ore negotiations on the back of the recent 65% price increase as the next high-water mark, BHP Billiton stands to benefit considerably. Highly leveraged towards the iron ore and coal trades within the Asia-Europe and Intra-Asian market, BHP would be expected to register strong earnings growth over the next 6 months; further supply restraints and port congestions in the region notwithstanding.
As the third largest supplier of iron ore coupled with its close proximity to China and South
Short-term price target of $66 as market reacts to BHP having to sweeten Rio deal upwards from 3.4 shares.
Longer term I am bullish on BHP and iron-ore prices in general. When deal closes BHP will be supplying 1/3 of the world's iron and will be the biggest supplier of thermal coal, copper, aluminum and possibly uranium.
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