Share tips and stock recommendations for the Australian (ASX) share market – buy, hold, and sell. Michael Gable is an expert guest commentator for the stock market newsletter thebull.com.au.

This post is an extract from the newsletter dated 7 October 2024. You can access the full version of the article HERE.

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Buy Recommendations

ASX:BMN

BMN has one of the world’s largest undeveloped uranium mines in Namibia. I am bullish on the prospects for uranium as there will be a shortfall of supply over the next few years at precisely the same time that demand for nuclear power is increasing. The shares are very cheap compared to its peers and the share price chart indicates that the low is now in and there could be significant upside from here.

ASX:RSG

RSG is a $1.6b African based gold miner and explorer. We continue to be bullish on the gold price from here due to falling interest rates, a weakening US dollar, and increased central bank buying. As a mid-cap miner, it is highly leveraged to the increasing gold price. From a charting point of view, it has a very strong trend which is outperforming most of its peers.

Hold Recommendations

ASX:BHP

For a while now we have been on the look out for a big recovery in resource stocks, and now that it is underway, you can’t go past BHP as a “go to” exposure. Apart from iron ore, BHP’s other major exposure now is in copper. We expect copper prices to pick up again as global growth picks up and the Chinese economy recovers from its lows. Fund managers on a whole have been massively underweight in resources, so inevitable plans to rectify this will continue to add upwards pressure to the share price.

ASX:MIN

MIN has been heavily shorted recently by hedge funds, but as markets continue to realise how cheap and oversold resource stocks are, the shorts will need to continually purchase more MIN shares to cover their positions. We expect this recovery in the share price to continue and recent price action has made it clear that we have found the lows in the share price. MIN’s main exposures are in iron ore and lithium and recent Chinese stimulus is also helping lift these commodity prices.

Sell Recommendations

ASX:NAB

We have recently taken profits in banks and it is now clear that there is a rotation of funds out of banks and into resources. This is expect to continue for a while. Although it is cheaper than CBA, NAB is a lesser quality bank in comparison. This means that buying support is unlikely to emerge soon and it could fall back towards charting support near $32.

ASX:RHC

Margins continue to be squeezed as earnings continue to struggle and fall short of expectations. The outlook continues to look difficult here as pricing for services is not keeping pace with inflation. The share price chart is also looking negative due to the downtrend that has been in place for the past two years.

 

Michael Gable is managing director of Fairmont Equities.

 

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