contrarians rewarded

Many of us bought into the likes of NWH as a contrarian play – that is, on a gloom-overdone-baby tossed-out-with-bath-water theme. It has turned out as a good move for me, although I started buying NWH to soon at $2.00, ending up with an average of $1.344. On the basis of strong conviction I bought 100,000 in four purchases. Below is an article on this topic:

http://in.reuters.com/article/2013/09/10/markets-australia-stocks-idINL3N0H544420130910I

In part it reads: "All the mining services stocks had a significant rerating in prices over the last month," said James McGlew, executive director of corporate stockbroking at Argonaut, adding
contrarian investors were buying back these stocks after they were oversold earlier this year. We saw the baby going out with the bath water when the gold price had its big drop a couple of months ago." I am unsure why McGlew mentions gold specifically, but that aside, his words could apply to NWH and other stocks that are not gold plays.

Because NWH has a good dividend and heaps of cash to be able to pay it, I see it as an investment-quality stock – not simply a short-term trading play, although it was that too when the SP was at its recent nadir. I am happy to hold on the basis that its EPS and DPS estimates for 2014 and beyond are, in my opinion, more likely to be increased than remain where they are now pitched, or decline further. What I am saying is that management have been conservative on what may lie ahead, and brokers have taken their cue from that. Look out for brokers' upgrades.

Normally, I do not take punts as I have done with NWH and BYL recently, but old codgers are allowed a bit of fun (is there a song in there?)