Smaller stocks on the move

By Intelligent Investor · 6 Apr 2001

By Intelligent Investor ·
6 Apr 2001

If you like watching westerns, probably one not to watch too carefully is Western Metals (WMT - $0.11). This stock remains below the level of issue 70 (Hold Ordinaries/Accumulate Preference - $0.16) in spite of just appointing Geoff Wedlock as the company's new MD.

Sure, in the latest half-yearly result there's a 15.7% drop in sales, but net profit after tax before abnormal items gained 178% to $2.6m, boosted by copper production up 28% and zinc output 19% better. The company remains heavily indebted but the yield on its preference shares – now around 15% - more than makes up for this, especially since the company is cashflow positive. HOLD the ords and BUY the prefs for yield.

IMPORTANT: Intelligent Investor is published by InvestSMART Financial Services Pty Limited AFSL 226435 (Licensee). Information is general financial product advice. You should consider your own personal objectives, financial situation and needs before making any investment decision and review the Product Disclosure Statement. InvestSMART Funds Management Limited (RE) is the responsible entity of various managed investment schemes and is a related party of the Licensee. The RE may own, buy or sell the shares suggested in this article simultaneous with, or following the release of this article. Any such transaction could affect the price of the share. All indications of performance returns are historical and cannot be relied upon as an indicator for future performance.

Smaller stocks on the move

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