Xstrata Rights Issue

[Pound foolish]

What do you think will happen with Xstrata with the two for one rights issue? XTA

Worth 1000p now 695p rights issue you can buy 2 for 210p for everyone you have.

Now the maths! 2 shares at 210p = 420p
One shares at current price = 695p
threes shares worth a total of 1115p

That equates to a price per share of 371.66p after the rights issue?

So my question, is current price too high given the rights issue?

 

[foredog]

possibly,


BUT

If they are not Ex-rights and you sell them now then you will be short 1 ordinary and 2 new @ 210

so if they trade xr at 372 you've made 320 on one share, but are wrong 162 on two shares.

beware, thats why a lot of shares have gone up after rights issue announced because all the bears want to buy their shorts back so as they are not short of the ights as well.

 

[Pound foolish]

Bought these yesterday at 310p after they went down 50% ish!¬
I know this was due to a shorting and the rights issue but show a nice little tickle now and wanted these fdr a long time, for the long (5 years) term.

 

[Pound foolish]

Bought these yesterday at 310p after they went down 50% ish!¬
I know this was due to a shorting and the rights issue but show a nice little tickle now and wanted these fdr a long time, for the long (5 years) term.

Did anyone else get on this bull?

Now 572.5 and still with some puff left to go I think. great long term prospect too i think.

 

[robsingh]

Looking at the history, XTA is on of the few mining shares trading at a heavy discount with a P/E of only 1.1 (dec 08). Compare that to Lonmin with 4.9 (sept 08) and you will ee they are still a good buy. I woudl suggest you go long on this via CFDs and quadruple your returns! Happy trading

 

[Pound foolish]

Looking at the history, XTA is on of the few mining shares trading at a heavy discount with a P/E of only 1.1 (dec 08). Compare that to Lonmin with 4.9 (sept 08) and you will ee they are still a good buy. I woudl suggest you go long on this via CFDs and quadruple your returns! Happy trading

723 on Friday. I am not sure what is happening on the markets in general over the next few weeks so have stop lossed my portfolio today. SLoss XTA at 600 locking in 100% return!

I wished I got on Vedanta VED when it went to 380! Even at 500 it was cheap but a lesson learned!

 

[robsingh]

Dear pound Foolish

As tempting as it may sound it's still a long way off it' actual worth. If you look at your portfolio daily, you are bound to get distracted by the fluctuations, invigorating your animal spirits of "locking in the profit" and be satisfied with a successful trade albeit not as profitable as it could be.

If you are an active trader, it's worth looking out to re buy when it drops below your last trade price but at these prices a BLANKET gain will almost outperform the traders of the likes of you and me.

Don't forget it traded at £29.00 not long ago (I know production capacity has been reduced etc), but commidity prices are on the up again and BRICS are still hungry for growth!!

 

[Pound foolish]

yep that's what I thought when I bought them. The BRICS will always need what the miners have got.

Thats why I like them. But I dont think we will see XTA at £29 this year matey!