Globe says Macarthur considered attractively valued
The Globe and Mail reports in its Tuesday, Sept. 29, edition that Paradigm Capital analyst David Davidson says Macarthur Minerals' (55 cents) Lake Giles project appears set up to produce a "premium iron ore that demands premium pricing." The Globe's David Leeder writes in the Eye On Equities column that Mr. Davidson, seeing an "attractive" valuation, commenced coverage of the miner with a "buy" rating. Mr. Davidson set a share target of $1.65. Mr. Davidson says in a note: "For the past decade, China has dominated the iron ore market with 50 per cent of global consumption because of its insatiable appetite for steel production. However, owing to the growing amount of air pollutants plaguing its cities, China increased regulations through its Blue Sky Action Plan that includes a focus on the production and use of iron ore, coking coal and natural gas. Lake Giles's iron ore concentrate is a high-grade, low-impurity product that permits steel mills to optimize and balance lower-quality ore blends, increase efficiency, lower costs and reduce CO2 emissions in the blast furnace. Going forward, we believe continued growth in steel production will support iron ore prices."