Short to mid term future for RIO and BHP?

[princeplanet]

I got out of them in June, and now wish I didn't... Does anyone think they will fare better than the big banks in the next 12 months - accounting for dividends - do the miners have more upside momentum? Knowing my luck, they'lk probably start tanking as soon as they buy them! .....

 

[Tightwad]

not sure really, with the mining boom looking shaky at the moment the short term isnt looking anythign special. BHP seems more diversified than RIO, but they've done their share of dumb things of late and theres the question of a big project not going ahead.

 

[princeplanet]

any other thoughts?

 

[Steve C]

not sure really, with the mining boom looking shaky at the moment the short term isnt looking anythign special. BHP seems more diversified than RIO, but they've done their share of dumb things of late and theres the question of a big project not going ahead.

I agree with the above post, in terms of capital projects if anything miners are in a down cycle with assets being sold off and mining projects being put on hold or considered not feasible in the short term till commodity price and chinese demand start trending upwards again, there is also just too much volatility around Euorpe and funding is getting harder and harder to get. My comments are related to mining in general not rio or bhp specific but I still don't see anything spectacular happening in the short term.

Steve

 

[qldfrog]

I would definitively avoid like the plague if planning to buy on the asx.
1) the mining boom is over and has been for quite a while now: do not believe the TV news
2) both Rio and BHP are trading at a great premium here vs London:
when ( and not if) the asx starts providing easy international trading access, why would anyone pay more to buy the same shares here than in London-> so you will see a nice double digit fall on these two;
Maybe purely technical but the dollars lost will be real;


DYOR obviously

 

[Trembling Hand]

when ( and not if) the asx starts providing easy international trading access,

Hey? What the hell do you mean? We aren't North Korea.

 

[qldfrog]

Hey? What the hell do you mean? We aren't North Korea.

you can not currently trade BHP/Rio or other shares trading in London via the asx; But this is about to change based on interesting article I read a few months ago in AFR, and so will certainly affect the extra premium these two have in OZ;
did not get the reference to North Korea..
DYOR of course

 

[mixedeconomist]

I got out of them in June, and now wish I didn't... Does anyone think they will fare better than the big banks in the next 12 months - accounting for dividends - do the miners have more upside momentum? Knowing my luck, they'lk probably start tanking as soon as they buy them! .....

Patersons has both at BUY, recently valuing BHP at $50 (August), and RIO $90 (July).

 

[SilverRanger]

you can not currently trade BHP/Rio or other shares trading in London via the asx; But this is about to change based on interesting article I read a few months ago in AFR, and so will certainly affect the extra premium these two have in OZ;
did not get the reference to North Korea..
DYOR of course

Ever heard of LSE and NYSE?
The reference to North Korea is that these exchanges are easily accessible in Australia. No need to do it via ASX...

 

[qldfrog]

Ever heard of LSE and NYSE?
The reference to North Korea is that these exchanges are easily accessible in Australia. No need to do it via ASX...

if it was that simple, why are people paying such a premium here?
Question: do you actually purchase directly on the LSE or NYSE?
I had a look at buying direct and gave up a year or so ago:
you have to get an account, pay a fee to actually keep your shares in and have currency change cost on top of it,
I found I was better off going with ETSxxx but limited range and US only;
Time will tell..BHP may announce extra dividends this week so the share may shot up

 

[Trembling Hand]

if it was that simple, why are people paying such a premium here?
Question: do you actually purchase directly on the LSE or NYSE?
I had a look at buying direct and gave up a year or so ago:

LOL, its VERY simple for a retail trader, Its absolutely no issue at all for institutional money which is all that matters.

 

[Vader]

BHP have a far tougher time ahead of them than RIO... with all the write downs they've had to do on their natural gas investments and problems at Olympic Dam etc. they have had to take on a heck of a lot of debt lately that isn't earning them money and their balance sheet is looking a bit on the sick side... they have got a lot of turning around to do IMO.

RIO are very Iron Ore heavy, but that's not necessarily a bad thing - their Iron Ore mines are some of the highest margin ones on the planet, so while a falling commodity price is obviously a concern, it's a bigger problem for their smaller competitors than it is for them... still got tough times coming, but IMO they will weather it better than most (particularly if the Aussie $ starts to fall back as the Iron Ore price declines).

 

[qldfrog]

+1
and BHP has the Marius Kloppers liability; he single handed turned a jewel into a shiny turd in my opinion;
worked for the last 4years for BHP and gave up recently; the policies at the top are abysmal and the results are showing...
Will take a while to turn around even when he is gone...he locked up the top with his mates and spineless clones
Time will tell; BHP may announce some extra dividends today to brighten the outlook, but the underlying situation is a no go for me...
DYOR