Tuesday, February 26, 2013

Labrador Iron Mines (LIM)

Added near the end of February 2015: I broke my rule and invested in a company referred to as "unprofitable." My investment, very small, disappeared completely. Oh well, it was more fun owning LIM than buying a lottery ticket but no more profitable.
_______________________________________________

Just caught a fellow on BNN  talking about Labrador Iron Mines (LIM). He wasn't bearish on LIM but he did have some strong reservations. He felt the cancellation of the proposed CNR line was not as harmful to LIM prospects as others in the trough but I know I would not buy LIM now.

Labrador Iron Mines reportedly sees no "adverse impact" from the CNR rail plan suspension but I find that hard to believe. On the plus side, LIM is going to be reimbursed its advance payment of C$1.5 million.

This is an isolated geological formation with large confirmed iron ore deposits. The proposed 800 km (500 mile) track was, in my mind, an important part of the puzzle confronting producers on how to make the extraction of the iron ore profitable. I think the challenge has just become harder.

If I held a lot of this stock, I'd sell. I only own a little and so I see this as a personal hold. If it climbs above my entry point, I'm out.

No comments:

Post a Comment