I think at $1.50 its becoming a screaming buy. P/E ratio now...

I think at $1.50 its becoming a screaming buy. P/E ratio now around 9 based on anticpated profit of $230 million this financial year. Results this year (as disucssed in May update) adversely affected by $A, steel demand and weather (paticularly affecting iron ore exports). In next financial year:
- iron ore exports should increase and according to Albanese from RIO prices should hold up
- according to Reserve bank we are on the cusp of major investment boom in mining sector and this should be good for steel prices (because of own supply of iron ore OST is in a vastly superior competitive position to only significant domestic rival BSL, and competition from overseas is likely to be limited because of compteing demand from China, India and the rest of Asia)
- not built into price is possible increase in iron ore reserves and resources where OST has made significant investment
-diversification into mining consumables business
- policy clarity re carbon tax and minor impact

Of course all the above depends on world economic outlook. I tend to accept the view of IMF, World BAnk that likely growth internationally will be around 3-3.5%. Although I think much of Europe is a basket case and the common currency was and is an absurdity in the absence of a united political and economic state, China is now the 2nd largest economy in the world, our main trading partner and predicted to grow more than 9% in the coming year. In the US even thought the loons from the republican right ring are causing uncertainty, the economy is growing (even if somewhat aneamic).