re: robertsharron, page-10

re: paul100 I would think 6 tops. Next year will be close to the top of the cycle for IRON Ore. Wont take much of a fall in Iron Ore prices and the PE will be 15 to 20 in no time and look expensive.

The way I look at it is if I had 400M would I buy the company. Answer absolutely not. I could find many better valued companies to buy.

The other issue with MGX is that that they continually capitalise costs for waste removal which are much higher than they expense. The result to cash flow is much less than profit. In the last half they made 22M profit yet only generated 7M net cash. They also paid no tax which they will have to at some stage in the future

So if you had to borrow the 400M , the net cash flow would not even pay the interest bill.

There is some very dodgy accounting going on here. It may be legal but it is not accurate. If you really want to validate a companies account's cash flow is a much more reliable indicator than profit.