The biggest value bet in the last decade is about to pay off

by , 24 June 2014

After five months of strikes, yesterday Amcu signed the new wage agreements with the big platinum mining companies. This deal secured wage rates for the next three years.

And right now, this deal will be the catalyst for a massive profit opportunity for value investors.

Let me explain.

Platinum profits have been hit, but the value is still there

Although the strike has ended, a lot of damage has been inflicted in the platinum sector.

The problem is, this long strike has decimated profits at the big three platinum miners, Anglo American Platinum, Lonmin and Impala Platinum. And investors have run for the hills.

But the truth is these mines still hold great platinum assets. In fact, value investor and Chairman of RECM, Piet Viljoen has stated that despite all the short-term upsets (strikes), Amplats still has more than 50 years’ worth of platinum underground.

He believes that if you calculate a present value of all this platinum the company has underground, Amplats is trading at a bargain right now. And because of this, he and other value investors have been stocking up on Amplats.

And thanks to the end of the strikes, these value investors are about to receive a big payoff.

As Amcu calls an end to the strikes, investors will flood into platinum miners

With strikes resolved, investors are about to scramble to get into these big three platinum miners. And if you’re in early, you could ride a wave of profits as they drive the share prices way up.

In fact, some analysts are calling 50% gains in these companies share prices. And you could see this happen in just a matter of weeks.

So are you brave enough to bet big on value? If so, then you want to look at the platinum sector right now.

And if you want to know which of the big three platinum miners we believe holds the best investment potential, then you want to make sure you read this month’s issue of The South African Investor. Simply click here to learn more.

Until next time,

Here’s to staying ahead of the game,

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