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Is BHP a good buy at todays price
Answers
356 points
Dusty answered 8 months ago …
It is if the Markets have actually reached the bottom. The thing is, the worst may well be yet to come, both in the US and Globally. There is reason to expect that the Markets will fall dramatically in the autumn of this year and in the spring of 2010. It is probably worth sitting on cash until there is obvious improvement. That will very likely be in late 2011.
It is a difficult call. Australia is doing better than most other nations and is tied to China. As the Chinese economy and infrastructure build-up develops it will take Australia with it, to some extent. Australia is the major supplier of commodities like Iron ores, coal, etc. to China and BHP is one of the principal commodities players in Australia.
My money is waiting to see how things go over the next year or two.
3963 points
MNSL answered 8 months ago …
I think Commodity companies will underperform market in the next 05 years. Still many commodity companies are overvalued.
I think new sectors and next rotating sectors will emerge as leaders in the sector oriented bull markets in the next 05 years. For example globally selected egg and chicken companies including such Sanderson Chicken Farms, selected companies in infrastructure, selected discounted retailers, simple businesses such as repair shops, Second hand shops, educational services, farm products and export consumer goods will do well during next 05 years.
There will be less demand for oil, gold, coal, iron ore, copper, timber, rubber, palm oil and other commodities in the next 05 years. However there will be short term rallies on speculation for some commodities time to time. In addition some commodity stocks will appreciate in sector oriented bull markets in the next 05 years. I also think commodity market will move unpredictably until the next bull period in seven or eight years.
There is evidence that the recession is deepening in not only in Europe, Japan, South Korea, Hong Kong, Singapore and Australasia but also in less known countries and emerging countries. Unemployment will rise more than 10% in 2012 in many countries. As a result of this demand for commodities and assets will go down further.
Industrial orders including cars in some of above the regions plunged in January and February by more than 60%. This situation will continue for the foreseeable future.
There will be depressed environment for many assets and commodities there’s a huge inventory surplus in many commodities.
For example globally there is a surplus in grain due to over harvesting in almost all the countries. Now some countries implementing import and export control to give benefits to local farmers. As a result of this some emerging market will lose their grain market share in the future to small countries in the next decade.
