Oz Minerals – Update

OZ Minerals was recently added into our ASX 100 model portfolio.

We’re mindful of the selling pressure base metal prices have been under since the beginning of last month, with copper and nickel prices down 8% and 9%, respectively.

Commissioning of the Carrapateena mine later this year remains a key near-term catalyst to help support the OZL share price.  On  a valuation basis, we have OZL trading 10x FY20 earnings on a 2.4% dividend yield.

The company goes ex-div $0.08 on the 31st August.

 

 

 

 

OZ Minerals – FY18 Earnings

OZ Minerals was removed from our ASX100 model late last year after generating 144% return.

The stock is now under algo sell conditions.

OZL reported FY18 earnings that beat consensus with NPAT of A$228m. Dividends were lifted to $0.15

We’re buyers of OZL on the next algo engine buy signal. We will remain patient as the general price backdrop for resources  is  over extended in the short-term.

 

OZL and Origin Removed From The Model Portfolio

Over the last 24 hours, our ALGO engine has triggered sell signals for both Oz Minerals and Origin Energy. 

Both OZL and ORG have been longstanding components in our ASX model portfolio.

As illustrated in the summary below, ORG returned a respectable 30.93% over the 584 day holding period and OZL returned a whopping 144.21% gain, including dividends, since July of 2015.

Both of these names have been popular with investors and we’ll update with current ALGO signals in the near-term.

Oz Minerals

Origin Energy

Oz Minerals Is Back In The Buy Zone

As a result of trade tensions between the US and China, prices of raw materials and precious metals have been trading sideways to lower.

The same price pattern has emerged for the shares of mining companies that export these materials.

In this environment, the shares of the lower cost producers will generally perform better as the raw material price begin to improve.

During the last quarter, OZL reported that their production costs for copper had dropped from 97 cents a pound to 72 cents a pound. In addition OZL has a strong balance sheet and may expand their share buyback plans over the next 6 months.

OZL is part of our ASX model 100 portfolio. We see good support in the $8.80/90 area with an upside target near $10.20 over the medium-term.

OZ Minerals