I see three major things helping the LG stock price over the next 6 months:
1) The price of gold increasing as the US and Euro debt situation sinks in further with investors. Many foreign banks (including many asian) are already starting to stockpile gold in reserves as opposed to those fiat currencies. Could that with QE3 being considered in the USA in the coming months, no doubt we'll see our gold highs again.
2) The CGT takeover. If LG hits the mark on CGT, or at least get over 50% at a minimum then I can see excitement for investors in LG. As we can see, traders in Singapore aren't necessarily valuing LG on it's market capitalization but a lot of it's price is going to be speculators/investors looking for a 3-5 return of x00%.
3) The way those speculators/investors in Singapore will be getting that x00% ROI will depend on if LG can continue it's growth model and become a mid-tier gold provider. Being in a country that is known as the doorway to asia, I'm sure there will be a lot of hype and with good reason... asia has a lot of people and they're growing like crazy. As their quality of living increases, they'll want more luxury items and electronics.
In my opinion, if LG successfully grabs CGT, there will be a lot of hype that will probably see the LG share price fly past $1.40S and could possibly send it north of $1.50S. I will be looking for an exit around this price point because really their market cap doesn't justify this range but hype alone will get it there. We saw what happened when LG got significant control of SBL (hits $1.25ish). CGT is more established and had a previous high of about $.40 per share. I've read the CGT thread and a lot of holders are talking like our group did.
In the end, LG obviously has an aggressive model and if they can turn these small producers into profit makers, which previous management either couldn't or wouldn't do, then let's see what they can do with the mining assets.
SBL Price at posting:
1.2¢ Sentiment: None Disclosure: Held
