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David Smith

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  • A Closer Look At BHP Billiton's 2 U.S. Listed ADRs [View article]
    Hi,

    Thanks for your comments, if you like this type of trading have a look at my article on News Corp, it involves the spread between the voting and non voting shares. The spread is currently low at the moment and I have entered a position.

    All the best.....
    Apr 1 03:46 AM | Likes Like |Link to Comment
  • A Closer Look At BHP Billiton's 2 U.S. Listed ADRs [View article]
    Hi Bob,

    I think you are a little muddled up. Please see the following link for converting an underlying share to an ADR and vise versa. The link is for Interactive Brokers and they explain in clear english how this process all works. Obviously they are not the only broker that can perform this for you. Granted IB only support converting the London BHP to ADR and vise versa but it can be performed by other brokers for the Australian version and cause of the law of one price is why they always trade very closely together. If you google converting an ADR there is a lot of information on the net for you.

    http://bit.ly/Hzjkvu

    All the best and happy trading......
    Mar 31 11:59 PM | Likes Like |Link to Comment
  • A Closer Look At BHP Billiton's 2 U.S. Listed ADRs [View article]
    Hi Bob,

    You say "a share listed as BHP Ltd on the NYSE, an ADR, is not the same as traded asis traded on asx" but yes they are the same thing and arbitrage will keep the price difference to a minimum only difference is two asx shares equal one adr.
    As I explained in last response about the tax advantage for an Australian is 20 cents every six months and this does not justify a 15% premium.
    Mar 30 07:54 PM | Likes Like |Link to Comment
  • A Closer Look At BHP Billiton's 2 U.S. Listed ADRs [View article]
    What tax are you referring to? The franking credits that Australians residents receive with dividends? If so for example with the last dividend payment an Australian received US$0.55 dividend plus AUD$0.2278 tax paid per share, while non Australians received the US$0.55. I do not believe 23 cents in tax benefits justifies a 15% premium in price.
    Mar 29 08:12 PM | 1 Like Like |Link to Comment
  • BHP Billiton Vs. Rio Tinto [View article]
    Hi,

    Thanks for the comment.
    Yahoo Finance Analyst Estimates for 2012 EPS for Australian listed RIO is $7.79, today share price for Australian listed RIO is $65.28 results in a P/E of 8.37.
    Yahoo Finance Analyst Estimate for 2012 EPS for Australian listed BHP is $3.67, today share price for Australian listed BHP is $34.49 results in a P/E of 9.4. Of course the London listed BHP P/E ratio is lower as I mentioned in article.

    Regards
    Mar 29 07:58 PM | Likes Like |Link to Comment
  • World Acceptance Corporation - A Growth Opportunity [View article]
    Hi,

    Enjoy your articles. If this company ranks 120 on your list why not publish a write up on a company in your top 10.

    Regards
    Feb 19 12:30 AM | Likes Like |Link to Comment
  • A Closer Look At BHP Billiton's 2 U.S. Listed ADRs [View article]
    Hi Harry,

    Buying the spread means to buy BBL and at the same time to sell BHP. I am not aware of a broker that offers the trade, in one packaged trade but there might well be. With a broker such as IB it is easy just to leg in each side of the trade. If you grasp it Harry ask more questions and I be happy to answer.
    Feb 14 09:33 PM | Likes Like |Link to Comment
  • A Closer Look At BHP Billiton's 2 U.S. Listed ADRs [View article]
    Hi Alrado,

    As I said in the article it is not an arbitrage trade as the shares are not interchangeable, meaning you cannot swap a London listed BHP ADR for an Australian listed BHP ADR so it is not the law of one price and there is no guarantee that the prices will converge, but there is a low risk trade to trade the spread and take a few percent as the spread will more than likely trade to its average.
    To answer your question the tax obligations are the same between the two as is all economic rights and liabilities.
    Possible reason I have read why BHP trades at a premium in Australia, is Australians investors do not have the same choice of shares as in London and Australians are less likely to invest overseas, meaning there is a greater demand for big blue chip companies in Australia.
    Alrado if you like these types of trades keep a look out I will write an article on another one that works well.
    Feb 13 09:05 AM | Likes Like |Link to Comment
  • eBay Is Still One Of Our Best Bets [View article]
    Hi,
    Where do you get your projected data from that is used in the Income Statements?

    For Ebay FY2011 you have projected EPS at $2.02, where from the figures I have the EPS for the first 3 quarters was $0.97.

    Regards
    Jan 11 10:01 AM | Likes Like |Link to Comment
  • Total SA - Look For A Margin Of Safety [View article]
    Thanks,
    Keep the articles flowing please....
    Dec 16 12:24 AM | Likes Like |Link to Comment
  • Total SA - Look For A Margin Of Safety [View article]
    Thanks for your article.

    On the topic of oil companies, how does BP look at current price with your calculations of intrinsic value?
    Dec 15 03:23 AM | Likes Like |Link to Comment
  • Apple - Is Now a Good Time to Invest? [View article]
    Thanks for reply.
    Dec 3 05:46 AM | Likes Like |Link to Comment
  • Apple - Is Now a Good Time to Invest? [View article]
    Thanks for posting article.
    What EPS did you use in your calculations for the intrinsic value for 2012 and 2013? What inputs did you use to arrive at you forecasts for the EPS, analysts estimates or continued growth rates?
    Dec 2 10:08 PM | Likes Like |Link to Comment
  • Microsoft: Undervalued At Current Prices [View article]
    I understand your point of view, but the numbers on the financial statements show me growth with a good profit margin, and Mr Market is offering me a chance to buy for a cheap price. Maybe in the years to come Apple will squeeze MSFT to death, but for now I maintain my opinion that the shares are undervalued at this point of time.
    Nov 18 02:32 AM | 2 Likes Like |Link to Comment
  • Microsoft: Undervalued At Current Prices [View article]
    Hi Brewer, thanks for sharing your thoughts. In my humble opinion, I believe for at least the next 5 years, Apple will continue to position their products at the premium end of the market, and will not license a Mac OS to a $400 laptop.
    Nov 17 05:49 AM | 1 Like Like |Link to Comment
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