As shareholders it is our duty to make sure that the cash gets invested wisely. One criterion should be that such an investment is equal or superior, in terms of ROE, to an investment in MLX itself (i.e. buyback). At current share price (and barring any surprise positive DFS results in Dec) Rentails does NOT make the cut. I'd be extremely cautious buying any other assets as well because of execution risk. Maybe things are looking OK still in Oz and US, but a large part of the world is looking at an abyss (Europe, Japan, China). Don't think demand for industrial commodities will escape this unscathed. Some of the demand destruction is taking place right before our eyes. Most prudent use of cash (IMHO) is to keep it as an insurance in the coming downturn and do a moderately sized buyback.
MLX Price at posting:
26.8¢ Sentiment: Hold Disclosure: Held
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