Resource stocks are a hard call at times!!

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Question asked 31/08/2024

Resource stocks are a hard call at times!!

Looks like I got the timing wrong when I bought into: MIN,LTR and FMG. Dividends cut and/or reduced plus in the case of MIN a negative report. Nevertheless, that is part and parcel of investing in the share market. What is your view on these three stocks now? ALSO, I know WHC is a regular on Q&A but, given that they have now reported and things look OK..? I am surprised with the direction of their share price. They may well drop further with the ex date approaching, This being the case it may be prudent to top up/buy. I also liked the YAL growth aspirations. What are your overall thoughts on WHC AS A SIDE ISSUE. You may like to have a look and comment if you like on two "out of favour stocks" for your Income or growth portfolios: APE and PWR. Competitive motor vehicle market but, good balance sheets, fully franked dividends, own a lot of their own real estate plus established and growing businesses. As they say "Buy straw hats in winter"

Answer

Hi Bob,

A large spectrum of topics covered in this question, we’ve attempted to cover the pertinent issues below:

We believe FMG & MIN are “looking for a low” and if we hadn’t entered too early we would be looking to accumulate into the current weakness.
Liontown (LTR) continues to make multi-year lows, but until the lithium price can start to improve we cannot see LTR rallying, unless Gina decides she wants to fully acquire the business – she’s already bought millions around $3, taking her stake above 18%, but it was trading ~74c on Friday.
We continue to like WHC and most coal stocks medium term but in the short term they remain heavy as the energy sector drifts lower.
We believe its a touch to early to venture into APE and PWR although the later is our preferred option at current levels. Our preferred stock exposed to similar themes here is actually Smart Group (SIQ), who reported well.

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Fortescue Ltd (FMG)

LAST UPDATED 30/08/2024 13:44

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