EQN - Equinox Minerals

[Buffettology]

Goldman Sachs JBWere now have a A$7.05 target on EQN.

EQN is trading at below 3 times 2008/09 earnings if copper stays above $3.00

EQN is on target, on budget and fully financed to turn-on the biggest copper mine in Africa in 8 months time.

Craig Williams and the team should be very proud with their accomplishments so far.

Just wait until EQN is producing 150,000+ tonnes of copper and 2 million lbs of uranium per year and $1 billion of cash is being generated to fund further exploration on the prime copperbelt property, or maybe even a monster dividend!

If you like copper, EQN is the pick.

Just a note on a takeover - EQN has a massive dilution-bomb as a poison pill for anyone hostile.

Any suitor will need to present themselves through the front door with a bunch of flowers and a large cheque.

Personally, I wouldn't give mine up for anything less than $10.00

Absolutely agree! I bought in at $3 something (so missed a lot of its huge gains), but still made a GREAT return and accumulated more while it was still around $3 something when we had that recent correction (well below $4). Though, I am thinking of buying even more, this one looks set for big things! I agree, in a few years, this share could easily climb upto near the $10 mark (assuming Copper does not get HAMMERED!).

 

[petervan]

Quarterly out last night with everything looking on time and budget.Very interesting to see how much exploration going on with drill results from 4 different sites coming out in the next quarter.Good results could see a serious jump in price and rerating. Definitly one to keep in the drawer

 

[champ2003]

Absolutely agree! I bought in at $3 something (so missed a lot of its huge gains), but still made a GREAT return and accumulated more while it was still around $3 something when we had that recent correction (well below $4). Though, I am thinking of buying even more, this one looks set for big things! I agree, in a few years, this share could easily climb upto near the $10 mark (assuming Copper does not get HAMMERED!).

I find it interesting to read that you forecast $10 in 3 years time. I don't hold this stock however am watching it closely. It has risen from $2.50 to $5 in 6 months. Going to $10 from here in the next 6 months would not be out of the question IMO.

 

[Sean K]

Gents, in regard to price targets, I see little more analysis to come to that conclusion than momentum, which is no analysis and does not satisfy ASF policy on posting price targets. There must be FA and/or TA to accompany targets.

ASF Policy on ramping

 

[BSD]

Some fundamentals perhaps...


EQN currently trading at ~3 times 2008/09 cashflow at $3.00Cu

To get near the current $10.00 'round number' target, I obviously think some of the following will come true:

a. The multiple will be closer to 6 times on production considering the 37 year mine life

b. Copper prices will be higher than $3lb

c. The uranium BFS NPV due in January will be positive

d. The company will have continued drilling success on its number of targets

e. The company will do another BFS on its own electrowinning plant to extract their own cathode as well as cobalt and acid

f. The company will put some further detail re: cost and timing, of plans to go to 300,000tn/Cu/pa (!) as announced in the Fin two weeks ago


Point (f.) is the BIG announcement I am waiting for to blast the stock way beyond the current GSJBW target of A$7.05.

Do the sums on 300,000tns of annual copper production, with the capex financed from free-cashflow.

 

[michael_selway]

Some fundamentals perhaps...


EQN currently trading at ~3 times 2008/09 cashflow at $3.00Cu

To get near the current $10.00 'round number' target, I obviously think some of the following will come true:

a. The multiple will be closer to 6 times on production considering the 37 year mine life

b. Copper prices will be higher than $3lb

c. The uranium BFS NPV due in January will be positive

d. The company will have continued drilling success on its number of targets

e. The company will do another BFS on its own electrowinning plant to extract their own cathode as well as cobalt and acid

f. The company will put some further detail re: cost and timing, of plans to go to 300,000tn/Cu/pa (!) as announced in the Fin two weeks ago


Point (f.) is the BIG announcement I am waiting for to blast the stock way beyond the current GSJBW target of A$7.05.

Do the sums on 300,000tns of annual copper production, with the capex financed from free-cashflow.

Hm that 37 year mine life sounds attractive for takover esp

Earnings and Dividends Forecast (cents per share)
2006 2007 2008 2009
EPS -6.8 -6.2 45.1 127.0
DPS 0.0 0.0 0.0 30.4

thx

MS

 

[lakuna]

Re: EQN - Equinox Minerals takeover by OXIANA

forgot to mention it would be positive for OXR share price too!

--------------------------------

apparently rumours going round the investment banks is OXR is about to announce a takeover for EQN very shortly. The new copper mine is of much interest to OXR, and as we know, EQN has admitted it could be a takeover target. It would be the best thing for EQN as financing the Lumwana mine is burning a cash hole in its pocket right now.

Hope you got into EQN below $5, rumour is offer price will be above $7.. nice

 

[Sean K]

Re: EQN - Equinox Minerals takeover by OXIANA

forgot to mention it would be positive for OXR share price too!

--------------------------------

apparently rumours going round the investment banks is OXR is about to announce a takeover for EQN very shortly. The new copper mine is of much interest to OXR, and as we know, EQN has admitted it could be a takeover target. It would be the best thing for EQN as financing the Lumwana mine is burning a cash hole in its pocket right now.

Hope you got into EQN below $5, rumour is offer price will be above $7.. nice

lakuna, unsubstantiated rumours can not be posted on ASF. Please see the policy here. You need to provide a source otherwise the post will have to go. Cheers, kennas

 

[BSD]

Re: EQN - Equinox Minerals takeover by OXIANA

forgot to mention it would be positive for OXR share price too!

--------------------------------

apparently rumours going round the investment banks is OXR is about to announce a takeover for EQN very shortly. The new copper mine is of much interest to OXR, and as we know, EQN has admitted it could be a takeover target. It would be the best thing for EQN as financing the Lumwana mine is burning a cash hole in its pocket right now.

Hope you got into EQN below $5, rumour is offer price will be above $7.. nice

Considering Goldman Sachs JBWere now has an A$8.50 target, any suitor would need to pay higher than A$7.00.

EQN are spending their debt package on building the mine, but OXR would equally need the finance package to build, the bill for Prominent Hill is now in excess of $1bn. .

Considering OXR has a PE in excess of 10 on current forecasts, taking over EQN at any of these prices with scrip would be highly accretive and certainly great for the OXR share price.

Note that a rumour around EQN/OXR/XTA/BHP/RIO/ZFX etc has done the rounds on a weekly basis for over a year

Once again, EQN has a large poison pill available to management, so any approach needs to be friendly.

 

[michael_selway]

Re: EQN - Equinox Minerals takeover by OXIANA

Considering Goldman Sachs JBWere now has an A$8.50 target, any suitor would need to pay higher than A$7.00.

EQN are spending their debt package on building the mine, but OXR would equally need the finance package to build, the bill for Prominent Hill is now in excess of $1bn. .

Considering OXR has a PE in excess of 10 on current forecasts, taking over EQN at any of these prices with scrip would be highly accretive and certainly great for the OXR share price.

Note that a rumour around EQN/OXR/XTA/BHP/RIO/ZFX etc has done the rounds on a weekly basis for over a year

Once again, EQN has a large poison pill available to management, so any approach needs to be friendly.

At current forecasts, $10 sounds like a fair bid

thx

MS

Earnings and Dividends Forecast (cents per share)
2006 2007 2008 2009
EPS -6.8 -6.2 45.1 126.0
DPS 0.0 0.0 0.0 24.9

 

[Buffettology]

Re: EQN - Equinox Minerals takeover by OXIANA

At current forecasts, $10 sounds like a fair bid

thx

MS

Earnings and Dividends Forecast (cents per share)
2006 2007 2008 2009
EPS -6.8 -6.2 45.1 126.0
DPS 0.0 0.0 0.0 24.9

Absolutely!

And the beauty of EQN is that it experiences MASSIVE volatility! Means you can buy in for the long-term with a portion of your portfolio and then trade it also with another portion week to week!

The money I have been making off EQN lately is out of control! At this rate I will be able to retire for good! My earnings from stocks if far exceeding my income from working over the last 6 months!

 

[petervan]

Zinifex narrows choice of CEO
LEAD and zinc mining giant Zinifex is close to naming a new chief executive, with the board in talks with a final candidate, reportedly ex-WMC boss Andrew Michelmore.

Getting a new CEO in place is an increasingly urgent priority for Zinifex with consolidation in the global mining sector set to peak as the world's biggest miner, BHP Billiton, tries to convince rival Rio Tinto to agree to a $US360 billion ($394 billion) merger.

And Zinifex is an attractive cash box for a predator with $1.7 billion in proceeds from the float of its smelting assets as Brussels-based Nyrstar now sitting in its bank account.

Zinifex shares jumped 4.3 per cent to $15.45 a share on Friday as mining stocks were bid up on expectations of further takeovers.

The appointment of the ambitious Mr Michelmore would send a signal that Zinifex is determined to forge its own destiny rather than be a passive target, and Mr Michelmore would be expected to seek to use the Nystar proceeds to grow the company.

Before returning to Australia last month, Mr Michelmore was a senior executive at Basic Element, the holding company of Russia-based global aluminium giant Rusal, giving him a broad set of connections beyond his WMC days.

But whether Mr Michelmore, if he is appointed, will have much time to act is questionable. And he risks a serious bout of deja vu if as new CEO his immediate role is to conduct a bid defence.

Mr Michelmore was left with the job of trying to navigate an independent future for WMC when former boss Hugh Morgan spun off the alumina business as Alumina Ltd to stave off a takeover from Alcoa.

WMC instantly became the market's favourite takeover target, in 2005 BHP duly bought it for $9.2 billion after Mr Michelmore had headed a long-running defence against initial bidder Xstrata.

Indeed the perception that Zinifex is a target is believed to be why it has taken the board so long to find a replacement for Greig Gailey, who left in June is and now chairman of the Business Council of Australia.

An option for Zinifex is a long-tipped merger with fellow Australia mid-tier miner Oxiana, talks with which earlier in the year came to nothing.

Oxiana chief executive Owen Hegarty wants to aggressively grow Oxiana into a diversified miner, and had a good look at nickel miner Jubilee before Xstrata beat off competition from BHP with a $3.1 billion bid.

The Australian understands that Oxiana had about four months ago taken a serious look at emerging copper producer Equinox Minerals, which is aiming to start production next year at its Lumwanna copper project in Zambia.

Since then Equinox shares have soared up from about $3.40 in August to now be $5.84 a share, valuing it at $3.3 billion.

 

[michael_selway]

Re: EQN - Equinox Minerals takeover by OXIANA

Absolutely!

And the beauty of EQN is that it experiences MASSIVE volatility! Means you can buy in for the long-term with a portion of your portfolio and then trade it also with another portion week to week!

The money I have been making off EQN lately is out of control! At this rate I will be able to retire for good! My earnings from stocks if far exceeding my income from working over the last 6 months!

What others shares do you own orhave bought recently?

Date: 19/10/2007
Author: Michael Vaughan
Source: The Australian Financial Review --- Page: 63
Australian-listed Equinox Minerals expects to commence production at a coppermine in Zambia in mid-2008. The Lumwana mine will initially produce 169,000tonnes per annum, but Equinox may eventually seek to lift this to around 300,000tonnes per year. The mine's copper concentrate will be processed atsmelters owned by Glencore and a Chinese consortium, although Equinox mayconstruct its own smelter in the future. CEO Craig Williams concedes thatEquinox could become a takeover target, although he says the company iscommitted to remaining independent

thx

MS

Earnings and Dividends Forecast (cents per share)
2006 2007 2008 2009
EPS -6.8 -6.2 45.1 125.4
DPS 0.0 0.0 0.0 25.5

 

[Buffettology]

Re: EQN - Equinox Minerals takeover by OXIANA

What others shares do you own orhave bought recently?

[/B]

Not too many actually.

Bought BXB at 11 something, then it shot up and sold it.

Bought BKL when it hit 20, sold at 22.

Bought about 40k worth of JST at 3.83, sold all the way up and sold my last lot at 5.88. Just bought back in when it hit 5.35.

Bought MCR at about 3.50 on its downfall, sold at 4.30 or something like that.

Bought SDG a couple of times low, and sold it above 4

Bought EQN originally at around 3, sold up at about 6.04. Plus traded it numerous times along the way. Bought some more at 5.50 I think the other day.

Their my main stocks I like (though not MCR anymore).

So this last 6 months has been a feast in the market!

 

[petervan]

Equinox uranium feasibility infill drilling confirms high grade uranium mineralization at Lumwana.Of the 170 holes drilled, 135 intersected uranium mineralization of 200ppm u3o8.Shareprice up 7% in Canada last night

 

[dj_420]

Equinox uranium feasibility infill drilling confirms high grade uranium mineralization at Lumwana.Of the 170 holes drilled, 135 intersected uranium mineralization of 200ppm u3o8.Shareprice up 7% in Canada last night

EQN is one stock I dont mind holding in the event of a downturn or sell-off, this company goes from strength to strength. My only complaint is that I didn't buy in earlier.

 

[Buffettology]

^^^^^

Exactly, I hold rather large sums of this stock now, and even in a downturn I will continue to hold. This is a long-term mining company right here! Dont hear that too often! Too bad I didnt buy more when I had the chance back at $3 when I first came accross this stock.

 

[michael_selway]

^^^^^

Exactly, I hold rather large sums of this stock now, and even in a downturn I will continue to hold. This is a long-term mining company right here! Dont hear that too often! Too bad I didnt buy more when I had the chance back at $3 when I first came accross this stock.

Hi what do u think of Coal stocks?

Earnings and Dividends Forecast (cents per share)
2006 2007 2008 2009
EPS -6.8 -6.2 45.1 125.4
DPS 0.0 0.0 0.0 25.5

thx

MS

 

[Buffettology]

Hi what do u think of Coal stocks?

Earnings and Dividends Forecast (cents per share)
2006 2007 2008 2009
EPS -6.8 -6.2 45.1 125.4
DPS 0.0 0.0 0.0 25.5

thx

MS

Cant say I have looked at any Michael.

I have browsed through several hundred companies and continue to browse. I also look at new floats when they come up and decide if any of the companies I am looking at look like stable, long-run companies based on my own criterion.

 

[Buffettology]

Bad news on Copper pricing, with it hitting a 3 month low I beleive!

I was also reading there is expected to be major overcapacity in a few years time, with current oversupply already out there.

Not a good sign for long-run copper prices! Only bad news on EQN so far, need copper demand in Europe and the US to pick up again!