By Nigam Arora & Dr. Natasha Arora
Signal(s) to enter, add, reduce, exit, hold or change.
NGLOY has started a restructuring after thwarting a buyout bid by BHP (BHP).
Here are the key points:
- Management believes that it can produce higher value by restructuring compared to selling the company.
- In The Arora Report analysis, if the restructuring is successful, the stock should go higher assuming investors continue to favor miners as a group.
- If restructuring is not successful, the probability of another buyout bid is high.
- The prize here is NGLOY’s copper operations. In the long term, demand for copper is expected to surge for the following reasons.
- Increasing adoption of electric vehicles
- Feeding power hungry AI
- NGLOY plans to sell its De Beers diamond unit.
- The company plans to sell its platinum business. The company plans to sell or shut down its nickle business.
Quantity
Keep in mind that there is another copper stock FCX in the Model Portfolio. If you already hold FCX, you may want to consider reducing the quantity of NGLOY accordingly.
Zones
The recommended quantity is reduced from the prior *** (To see the locked content, please take a 30 day free trial) to ***.
For those who are following the Good Way, the Buy Now rating is ***.
For those following the Best Way, the buy zone is ***.
The very long term target is ***.
The Plan
The tentative plan is to accumulate more for a bigger quantity if the stock falls below the buy zone. In such an event, unless something fundamental changes, a new buy zone will likely be given to add to the position.
What To Do Now
Those in the stock may consider continuing to hold. Those not in the stock may consider following the parameters given above.
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This post was just published on ZYX Buy Change Alert.
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Nigam Arora
Nigam Arora is known for his accurate stock market calls. Nigam is a distinguished master of the macro. He is a popular columnist with over 100 million page views, an engineer, and nuclear physicist by background. Nigam has founded two Inc. 500 fastest growing companies and has been involved in over 50 entrepreneurial ventures. He is the developer of Theory ZYX of Successful Change Management and is the author of the book on Theory ZYX, as well as the developer of the ZYX Change Method for Investing.
Dr. Natasha Arora
Dr. Natasha Arora has significant expertise in investment analysis especially biotech, healthcare, and technology. Natasha is a graduate of Harvard Medical School followed by a postdoc at MIT. She has published several peer reviewed research papers in top science journals.
