Alumina (ASX:AWC) shares are cheap according to this top performing fund manager

1557

The Alumina Limited (ASX:AWC) share price has drifted lower since the start of August despite the aluminium miner recently reporting a doubling of first half profits.

Writing in its August 2018 monthly update, the top performing Yarra Emerging Leaders Fund said it increased its position in Alumina shares based on a positive view of the commodity and Alumina’s high-quality assets.

The fund sees earnings, cash flow and capital management upside for Alumina versus consensus expectations, saying the aluminium market remains very tight, and with the approaching Chinese winter closures again having the potential to be even more restrictive.

The Yarra Emerging Leaders Fund believes Alumina shares are undervalued at 10.8 times forward earnings when considering the strategic appeal of its assets.

Contributors to this article may own shares in some of the companies mentioned in this article. The Capital Club has a thorough disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
Avatar
Bruce Jackson has 30 years of hands on investing experience. He is passionate about stock market investing, running his own portfolio and SMSF. His focus is on small cap growth stocks. You can contact Bruce at brucej@thecapitalclub.com.au