Prominent Hill is key to a re rating of this company but it still carries considerable development risk. Until more information on the progress of this asset comes to light (Q4 08) the stock is arguably being supported by a slightly improving copper price.
All things considered there is still a nil value on the ZFX assets so on a 6 months view this would seem a cheap entry but as mentioned before its going to be a slow climb out of the basement.
Takeover is clearly a chance and I think that will underpin the price but the development of Prominent Hill is the company specific factor to watch against the background of the copper and zinc prices and overall sentiment to resources.
The half yearly result was definitely below most analysts expectations and the market is increasingly sceptical of board and management so again operational success at Prominent Hill is what will turn this around IMO.
OZL Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
