Not only FP was misledHi Everyone, Lets get the bad news out of...

Not only FP was misled


Hi Everyone,

Lets get the bad news out of the way before we look at this weeks stock. For the first time in 8 years, we recently picked a stock that went into voluntary administration.

On the 29th January, we highlighted View Resources (VRE) as potentially being undervalued at 18c. It reached 20c during the following week but on the 6th Feb the company gave an update on its Bronzewing mine stating that its quarterly forecast will most likely not be met. The report, although not good, gave no indication that the next day a trading halt would be called and the next day an administrator was appointed and the company was suspended from trading.

As stated before, this is the first time in 8 years that this has happened to any stock we have highlighted and it gives rise to question the openness and transparency of a company in relation to informing the market as to the true situation of the company. Even up to the very end, View's company announcements were upbeat and positive, bearing no hint or mention to the potential problems that lay just around the corner. Even in their statement on the 6th Feb they stated that the sale of their 30% stake in the Carnilya Hill project was set for imminent conclusion which would have cleared any debt.

We weren't the only ones to get caught. There are many investors and other analysts who were also caught out. Trading volumes and interest in this stock were very strong right up until the end.

We will be following with interest the results of this company and report anything that comes to light.

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Delayed Report
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Now, lets look at this weeks stock. We have gone for an established minor with quite a few positive signals showing right now...



- A Director just picked up almost $1.5M worth of shares around these levels which is a huge sign of confidence in this current market.

- Currently this stock is paying a 5.8% dividend with expected earnings increase next year of 11% and the year after 31% (source Thomson Financial)

- 8 brokers also have a buy recommendation on it.

All of these factors point to a potential rosy future but bear in mind that we will probably see continued volatility combined with the end of the bull market. A medium to long term view is more suitable in this market.

HALF PRICE SPECIAL OFFER ENDS SOON

Whatever you do, don't miss out on this one. Have a look at what we offer....


Until next week,

Happy Trading,

Keith Nielsen
CEO and author of 'Follow the Smart Money'

------------------------------------------------------------------------------- This weeks pick is KAGARA Ltd (KZL)

from their website..

* A leading diversified S&P ASX 200 Australian mining company.

* Low-cost producer of zinc and copper concentrates in the Mt Garnet-Chillagoe area, North Queensland.

* Three base metal processing facilities in operation at Mt Garnet and Thalanga, with a fourth under development at Mungana.

* Strong growth profile – targeting production of +100,000tpa zinc metal and +45,000tpa copper metal by 2009/10.

* Major commitment to exploration and new project development – Lounge Lizard Nickel Project and Admiral Bay Zinc Project (Western Australia).

* 2.6Moz gold equivalent resource base at Red Dome, North Queensland with ongoing exploration targeting a conceptual 50Mt resource.


Log into our members area right now and find out more.

www.theinsidetrader.com.au



Happy Trading,
The Inside Trader Team