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Reading all these posts the old question arises - if you don't do your own research are you responsible for your own decision to either buy or sell and to my mind the answer is a resounding yes. It isn't difficult to get information on the Directors and their past endeavours and associates and this would, presumably, be taken into consideration along with any other info available. This stock has been a roller coaster and if you like the fun park you hitch a ride otherwise you sit back and watch, there are no guarantees.

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None of it is illegal,

 

Sorry.

 

As I said its just how the world works.

A broker with a lot of clients long often will produce a report that's wildly bullish. Can one prove it is absurd ? No. I am sure there are so many quantifiers in it that they are well covered.

 

As to when it came out for CDU ... it was well known when the stock went thru $1- about this mystery report of $25-.

 

One cannot prosecute for being bullish.

One cannot prosecute for being insanely bullish either.

 

I am sure if the report was ever sighted the $25- target ... would have read it may be worth up to .... "worth up to" and then another condition ... say "should" the targets continue deeper ect ect. "Up to" and "should"

 

People rarely read the fine print. If the word "may" or "could" is in a sentence ... it basically means bugger all.

 

When I see a report on a small company after reading it ... and then reading the ASX releases of the company ... next step ... ALWAYS ... is to look for links on which organization wrote the bullish paper in the first place and vested interests. Especially if after reading the report and releases you don't agree or think it is insanely or absurdly skewed one way.

 

Its basic and simple research. If the broker in question is a large holder from an underwriting which didn't go so well a few months ago .... obviously they have some interest.

 

When I say it happens all the time ... it does.

 

Using an example I alluded to before. VTI ... Virotech a company which has moved totally to the AIM market thank god ... but it didn't like the press it got. The press questioned the outlook for the company and one such report ... and for its troubles the Australian Newspaper was taken to court and all media was silenced for many years. VTI claimed the article was ... well not nice ... it further was making noises about a massive settlement it would get, VTI that is.

 

It dragged on for years ... never actually going to court .... and was settled a few months after the absurd claim of large payments to settle it. Looking at the accounts the settlement was bugger all ... if anything. But it did have the effect wanted and silenced the critics.

 

When a company loosing money and always loosing money pays directors a bonus of 5 or was it 8 million ... cant remember which ... this went un-reported since the Australian case had all media scared of the company.

 

Now not sure what naughty thing the Australian was taken to task over. It pre dated the absurd bonus payments mind you .... but it questioned the claims of business made by the company ... and given the lack of it to date I would say they were well vindicated.

But for their troubles they got dragged through court ..... and anyone poking fun at them got threatened with the same if they could find them.

 

The law is not about who is right or wrong.

 

If one reads thru any of these failed companies reports, no VTI isn't failed its still going , but reading through the past announcements ... and then looking at realities 2-3 years onwards ... someone should have called them out.

 

With VTI before it left our fair shores had a well placed media campaign with of course the innocent broker report thrown in. In this case it was done by some mob called Durlacher I think ... calling for the shares which were $0.40 to rise to $2.50 within 12 months. On top of this there were reports especially in an online web site about a deal going down ... the long awaited massive deal. Nothing I suppose illegal in an of it.

 

Shares rose from $0.40 to $1.04 ... I thought they were all mad.

Usual rules.

 

Reason being Durlacher the UK broker with the call for shares to go 500% ... was none other than the sponsoring broker for the company on AIM in the UK and was also I believe he one arranging the placement needed to pay for the execs's bonus scheme.

 

Other reason ... the web site with the calls of the VTI mob being awarded the massive remediation contract ... well in fact it was a college news web site I believe.

 

 

Icing on the cake ..... seen it all before.

Remember the friendly UK broker with the insane call for the rise.

Well this wasn't the first report he had made with calls for a massive rise in the shares.

He made the same call two years before. Shares rose from 40 cents to 80 odd cents.

 

Second time around went from 40 cents to a high of 104.

By the time they left our shores they were back to 64 cents ...

 

Right now ... they sit at 16.75 pence or 42 cents AUD ... yet again.

 

Must be time for a new durlacher report ?

 

*********************************************************************

One might think I am overly negative at times ... but there is no substitute for good research ... none.

 

Sadly many are too lazy or just rely or a written report which in many cases is some form of paid advertising.

 

 

Its a reality of life .... even reading a thread on your favourite chat room for shares one has to take into account 99% of the posters are long.

 

Its all just common sense ... but its the wolves in sheep's clothing that annoy me.

Go read say ARE thread and answer my question there if u can.

 

Hardest one to spot is when the company itself gets involved in the insane promotion of the company in question and when the promotion has no or little relationship to realities.

 

CDU ... well its not in this ballpark. its found something. However personally would never ever invest in them due to the lack of knowledge of the guy who called anyone questioning his claims as dickheads. His call it would be the largest ever copper deposit was absurd as I pointed out at the time Olympic dam on official numbers was 60 million tons of contained copper and CDU would be lucky at 3 mt. I count numerous ones with far greater reserves than CDU will ever have ... so for me ... when the MD makes claims like this ... its scares me and leads me ... in this case to have leaned too far in the opposite direction.

 

Yes they did have something .... but knowing a bit about the industry when someone buys a new Holden Astra and claims it does 400km an hour ... and u know it barely does 100km an hour it leads you to question whether the Astra they bought even has an engine in it.

 

If you know something is a lie or a complete fabrication ... any child knows it will cause people to question even factual information despite the hard evidence to back up the less insane claims. This lack of competence might lead me to call the MD a name back ... but what do I know.

 

Cry Wolf

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In reply to: trade4profit on Wednesday 18/10/06 08:33am

Morning T4P http://www.sharescene.com/html/emoticons/smile.gif

 

I'm not disputing either your claims or the fact that the find is POTENTIALLY enormous at all. But therein lies the point - it is only a potential value. Now maybe I'm a bit old fashioned, but I can see the value of a defined reserve, a proved-up resource, whatever, translated into the share price. The difficulty I have is in trying to put a value on a share NOW for something that MAY be confirmed later, that MAY sometime in the future become an actual producer, that almost CERTAINLY will need to dilute the shares with SPPs, placements, etc as they consume funds, etc etc.

 

Maybe the body of copper really IS worth $25 a share based on the number of shares currently out there. But that ain't going to be the end of it. For example - what about the dilution factor when WM and his directors exercise those shiny new 50-cent options? And all the other money they'll need to raise from the market in the meantime? And the cost of production? And the price of copper at the time they actually start digging it out - which in turn will be affected by supply and demand?

 

Way too many variables for me, to put a share value NOW on something that is a "MAYBE" at some time way off in the future.

 

That's the problem I have, not yours or Dawes's assessments per se. The problem I have with Dawes's analysis (I haven't seen it either) is that it is telling the market that the shares are worth $25 each - when they are NOT, but they MAY be some time in the future. And to me, that's blatant ramping when he works for one of the major shareholders.

 

 

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In reply to: NightStalker on Wednesday 18/10/06 11:13am

NightStalker...

 

You assume these variables have not been considered?

 

Whilst obviously unable to know exact numbers for all sorts of costs, etc...lol...we can still apply typical "ranges" which cover most scenario's, based on peers, similar projects, whatever.

 

This is not hard, although a fairly wide brush I do admit.

 

Apply cash at hand, including that from all options exercised as well as addtional dilution from the last of the convertible notes...and one can assume a starting point.

 

Clearly many variables...yes...but that is the challenge of working this end of the market; to determine before everyone else what the inherent value might be.

 

Cearly, not for everyone.

 

Further, we are not talking pure clinical "in ground values" here...there is a regional strategy premium that must be considered, as well as scale consideration...and most importantly for me, shape of the register, which thanks to the options issue to directors, I now see as safe. This alone could be worth anything from 20 to 100% added to any value model for various reasons.

 

I been through this in some detail over at the other place, so won't go over it all again...but suffice to say, a strategic (phased) move on the stock, not one designed to get 90%, but one with a likely target of more than 50%, could arguably achieve for much much less (over time) with a vulnerable register, what might otherwise cost considerably more.

 

Remember, once 50.1% is reached, the shape of the board can be changed and a long slow drawn out process of diluting the "other side" can commence. This would be catastrophic for shareholders.

 

In this example, just 5% balance can make or break such a scenario...say the suiter (assuming one exists) fails to get to 50%...then McCrae and co can turn the tides an gradually dilute them back to insignificance.

 

The $ amount required to get to 50% is the key issue...always has been...no suiter was ever going to get 90%...never. Unfortunately, corporate manouvering can see such assets taken out of the hands of shareholders at prices not even remotely close approaching in ground values.

 

So what price will guarantee 50.1%?

 

Prior to the options issue, the register may have been vulnerble to say an $8 or $10 offer to gurantee they get over 50% (maybe even less)...now, assuming McCrae has shored up the register appropriately, it may take $15, $20...maybe more to get enough shareholders to "cross the floor".

 

We now have a much better chance of getting an offer at least close to any percieved (or otherwise) in ground resource value.

 

People will discount this scenario...I do not...as I do not discount the possibility more than one suitor may be already circling...Xstrata certainly, maybe one or two others? In fact I suspect at least one other in particular, it fits their stated objectives, they are known to have looked all over the country at inferior projects...but perhaps this is best left unsaid in case it has wrong impact.

 

Anyway, I digress...in the end, none of that which I have discussed will ever eventuate if there is nothing here.

 

My personal research has suggested that, in spite of all the colourful "adectives" flying around, that this is in fact very big...VERY BIG...both current AUM/CDU data confirms this, as does historic survey data, which clearly confirms to my satisfaction, what we have here.

 

What satisfies me however, may not satisfy someone with less apetite for the risk associated with early mover status.

 

I suggested it was grossly undervalued at 70/90c based I what I knew then...and I suggest it is still grossly undervalued at current prices ($3.85) given what we know now.

 

Will this mean the price will go up? Who knows?

 

In time I suspect deffinately...in the interim, I suspect corporate motive may impact.

 

Cheers!

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Good post, T4P http://www.sharescene.com/html/emoticons/smile.gif

 

Yes - I understand where you're "coming from" as they say, and the corporate shenanigins which may yet eventuate do need to be taken into account.

 

I guess the bottom line is the early adopter analogy. Those people who buy the latest electronic gizmo, the latest software, the latest laptop computer etc are taking a risk. Buying shares in a very early exploration company carries a risk also, and as you say, that may not be to everyone's taste or risk profile.

 

I will still be watching from the sidelines with great interest. Interesting that the hype and heat seem to have gone out of the trading in CDU for now - only 48,300 shares traded today so far, at 12:23 pm. Couldn't have seen that happening a few weeks ago http://www.sharescene.com/html/emoticons/devilsmiley.gif

 

 

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Did anyone notice in the Australian article on CDU (published monday i think?) that talked about the possible interest of the exCEO of MIM (from memory he did not agree to the Xstrata bid) and thier joint venture partner Nippon Mining?

 

Did a bit of research on Nippon Mining. didnt ctach it's market cap but it's profit last year was $855M US and it also had $15.7B US in assets. think it has the largest copper smelter in Japan. It wasnt talking takeover rather a joint venture with CDU. That would make for an interesting competitor for any possible Xstrata interest down the line.

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In reply to: loric on Wednesday 18/10/06 02:38pm

loric...

 

That's one scenraio...I have also reviewed another.

 

Well done.

 

All of which creates the type of competetive environment that might see Xstrata forced to pay fair value here.

 

Lets not forget, with existing infrustructure and a regional strategy to consider, Xstrata could arguably afford to pay considerably more than just about anyone else.

 

Cheers!

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Had to laugh at this...nice job being on the board of directors..they can have it

Maybe the fairfax boys should read this and the position company directors find themselves in before putting pen to paper..

What a joke asic and asx are becoming...or am i too late

 

 

 

 

 

Quote from Article

Michael Vaughan

 

ASIC's investigation and the Supreme Court decision send mixed messages to small and mid-cap miners. On the one hand, ASIC is discouraging companies from making releases to the market too frequently, with the implication these are used to ramp share prices.

 

On the other hand, miners have been told by the courts if you are unsure if information is price sensitive or not, make a release. Not doing so leaves both a company and its directors open for findings of negligence and damages payments.

 

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