monday, page-24

Im VERY comfortable saying EVER

BHP are making $15BN a YEAR. YEAR ON YEAR.

A $24 share price = a what, $110bn share price? (rough guesses here; but you get the point)


So at that level, with these profits, thats a PS of 7 - NOT INCLUDING CURRENT CASH POSITION.

CURRENT CASH is probably (again rough; just going off the top of my head) $40-$50bn. So, assets valued at $60bn ot a PE of 3.5-4.


The only way BHP would ever fall to $24 again is if:

a) they SERIUOSLY blew-up a MAJOR INVESTMENT. ie, payed too much for RIO - bought RIO at top of cycle. ie, lost dozen billion or so on an oil well or something?

OR

b) China STOP (and i mean stop!) buying raw materials.


Otherwise, sub-$30 will never happen. Let alone $24.

I mean, they're going to be making at least $6bn-$10bn (at the very least) for the next 10years (prob 20yrs imo)