Citi Price target $3.60, and i believe more inline with the...

Citi Price target $3.60, and i believe more inline with the majority of the research house estimates.

From this morning

Oxiana Ltd (OXR.AX)
Hello OZ, Now Buy or Buyback?
ƒæ Cash to Burn ¡X Oxiana has A$1+b in cash and ambition to grow copper and
nickel production through acquisition. Share price fall on zinc concerns and
market volatility begs the question ¡V is the best acquisition in fact itself? We
estimate a buyback would be highly accretive and we maintain our Buy/High
Risk (1H) recommendation and A$3.60 target price.
ƒæ Competitive M&A Playground ¡X Value-adding acquisitions in copper/nickel are
increasingly difficult to find given cashed-up competitors and escalating
project capex benefiting buy over build. Additionally, A$3-4b does not buy
much now.
ƒæ On-market buyback ¡X We estimate a A$1b on-market buyback would be 16%
EPS accretive in 2009. Conservatively leveraging up the balance sheet through
a A$2b buyback could be >40% EPS accretive. These are tough returns to beat
given the lower risk of a buyback versus an acquisition.
ƒæ Timing ¡X With the merger just completed and the M&A hunt only starting, it
could be 12+ months before any excess cash is handed back. A bare franking
account means an off-market buyback is not an option now, but could be even
more accretive down the track given the 10+% discounts achieved previously.