Forum Archive Index - November 2003

["SJ.Greaves" <SJ.Greaves@xtra.co.nz>]

I recommended AUO a few months back as a speculative buy around $0.45. I brought a few hundred thousand shares then, still own them now and intend to hold them for a while yet.

 I was also obviously watching last week for any bad announcements coming from the company. I can't give you any definite answers as well why the share price dropped. But I reckon there is still a bit left in the AUO stock price yet.

There is a lot of news about the $A verses $US having a bad effect on mining companies but AUO have hedge contracts at a very favourable exchange rate for approx another year yet.

The entire coking coal market is extremely tight. All of Australs coal production has been contracted for the next year. When the coking coal price is negotiated next year I would be surprise if the coking coal price doesn't move to more than cover the changes in the $A/ $US exchange rate.

AUO are coming to the end of a major upgrade to there plant and equipment,  that will double there production. If they had major delays to the upgrade or a major incident it will put a dampener on the share price. Apart from that I reckon it should trade near a dollar some time next year.

 

Time to watch the Rugby.