FMG and AGO really have completely different strategies; each have their pro's and cons.
There was an interesting article in the Eureka Report last week on the state of play for the IO players whereby the mentioned that FMG is looking to branch out into coal as it's inevitable that as the extra supply comes on-line in the next 2 years the price of IO will fall.
Personally I'd like to see AGO branch out in a similar way but I don't think there is a major rush to do so. I don't claim to be an expert but as I understand it AGO is getting the ore on boats at pretty competitive prices and we should continue to investing in growth for the short term at least.
Long term our positive cash flows should allow us to look at expansion into other commodities (such as SRR).
My feeling is there will be more M&A activity amongst the juniors over the next year with talk of players being 'stranded' could allow for some good buying opportunities for astute cashed up companies.
AGO Price at posting:
$3.99 Sentiment: LT Buy Disclosure: Held
