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Vale S.A. Message Board

  • finanza finanza May 11, 2005 6:57 PM Flag

    analysts made a big mistake

    This is crazy. I am reading a report of Goldman Sachs done in Feb. At that time they projected only 0,60 for this quarter but after they raised it to 0,70. The problem now is that estimates are really too high in the Street and even if the company does well it may be unable to beat them.

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    • I don't see what's rude about my disagreement, but anyhow: any rudeness was not intentional!

      The point is - guidance or no guidance does not make a good or bad company. So whether RIO gives guidance is irrelevant. I agree GIVING guidance and THEN missing it is a disaster. However RIO hasn't done this.

    • I owned CHK for years before trading out of it about a year and a half ago to go into some other oil and gas stocks. Currently I own ECA, TMR, and MHR after moving away from oil and gas and into coal in the last year. I will take another look at CHK although I am currently feeling a little overweight in the energy and basic materials area---but everything else looks so bad (except for some biotech I have that is doing well). I also believe in the long term story for 'things that come out of the ground'. Last summer I bought the iShares for Canada, Australia, and Brazil.

    • Just sharing an idea with a friend, hope you don't mind.

    • Sy

      Are you spamming? I have seen this note from you on another board.

      But since I am long CHK; keep up the good work.


    • You need to look at CHK, check out their insider buying, of late. CEO and COO have bought 550,000 shares in last several days. They (CHK) are making exactly the same play SWN (which recently really popped) is doing in Arkansas, albeit CHK is doing it acroos the line in Oklahoma. (Caney Shale; AKA Fayetteville Shale in Ark) It has the real potential of becoming the next Barnett Shale. EIA estimates that 90% of future ng wmust come from these "unconventional gas plays". The Arkoma Basin also has great CBM potential, CHK will thus prosper this year. They are fully hedged at $58 oil for 2005, $7.57 gas for 2005, and $7.53 gas for 2006. These are among the best hedges I have yet found. I have bought 1000 shares so far, and will add on weakness. If you are looking for something to buy you might want to check it out. EIA recently upped their ng average price estimates to 6.90s for 2005 and 2006.

    • I guess I just think they should have known better re anticipation of things etc. I also just feel we happen to be in a very unforgiving stock market at present. Thats not bashing, and I plan to hold, maybie even add to my position once a confirmed bottom is set. But it still makes me unhappy with mgt. One silver lining is that this is seen as an Iron Ore investment, when it is really an investment in Brazil. So, those who believe the Brazilian growth story for the long term, will have a great opportunity to buy at bargain prices. Also while a declining dollar hurts earningsw it actually increases relative book value and dollar based asset value.

    • In my previous post I mistakenly said SSB was expecting RIO to have pellet prices of $43.89/ton--that was wrong. They were expecting prices of $51.06 while RIO came in at $43.89. Sorry about that.

    • Well friend, you have been rude to Susan and now me, putting words into my mouth. I never said it was "right or wrong". I just challenged the thesis that "good companies" do not give guidance. Rightly or wrongly, be that as it may, plenty of companies which happen to be otherwise "good" or stable give guidance. XOM, WMT, GE, PG, JNJ, IBM all give guidance for instance, hardly "fly by night". Berkshire, Coke and some others do not, but plenty do. And please, no need to be rude, to me or anyone else.

    • I meant they worked for investment banking houses. "came from"=have their offices there GS, C, Morgan Stanley, ML etc. And in a way, they do "pay" them albeit indirectly by having a strong investment interest with the house in guestion. That is why ML got in trouble, that is why so many other houses liks C and Morgan Stanley etc got in trouble re MCI and ENRON. The analysts were being indirectly pressured to see things in the most optimisic manner, despite the glaring fact that it was all smoke and mirrors.

    • "No, Berkshire does not give guidnace, but 99% do."

      A typical example of twisted logic: "If 99% of companies do it, it must be right." Well, 99% of companies don't expense stock options. Does that mean it's right? Of course not. It distorts results upwards. Majority ageement can never replace deductive logic.

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