MRE is now trading at a PE of 4.92, a dividend yield of around 17-19% fully franked, no debt and $500 M in cash. The market has gone insane but it may well drop the price lower.
The market has also played right into the hands of Glencore who can probably acquire the company at around $7 in a nervous market rather than the $12 plus that they would have had to pay in May.
If they exercise the creep at these prices they will be able to acquire some 22 million shares or 4.7% of the company from their next dividend cheque alone (although that would blow their 3% limit for the 6 months).
Great opportunity for Glencore and I would not be surprised to see them sharpening their pencils right now.
Regards Eos
MRE Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
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