Dyno Nobel Ltd (DXL) Share Trading Reccommendation

Dyno Nobel Ltd (DXL) have a retained Hold / high Risk share trading recommendation and have an increased share price recommendation of $2.75 (from 2.70) from analyst Citigroup Investment Research (CIR). However, Orica remains the analyst's pick remains their pick of the sector. Dyno's long awaited announcement that it is to proceed with its Moranbah ammonium nitrate plant was broadly in-line with CIR's expectations, albeit with less certainty in a number of areas. According to the analyst, Dyno shares the risk of cost over-runs with the contractor, with project "in the vicinity of $520m". In addition, Dyno is taking some exploration risk on gas supply, which is likely to have lowered the cost (albeit that contract not yet signed). Other risks include a labour agreement not yet inked, and the additional risk of a second hand ammonia plant. Hoever the analyst points to an upside: Dyno confirmed that its AN supply contracts also includes the supply of ancillary products and services to those customers. These contracts start phasing in over the next four years and are somewhat more positive than CIR expected. Project funding will be provided by additional debt facilities, internally generated cash flow and a proposed $250m hybrid issue. The final financing structure is yet to be resolved, but we believe it is becoming less likely that it will include a third party. Factoring in revised assumptions for Moranbah has resulted in reductions to CIR’s earnings forecasts for F07e and F08e of 6% and 10% respectively, reflecting project scope and financing, and a 9% increase to their F09e reflecting a faster than anticipated ramp-up.

Dyno Nobel Limited is listed on the Australian Stock Exchange (ASX) under stock code DXL. You can view their investor website here. DXL was listed on the ASX on 7 April, 2006. Peter Richards is the CEO for Dyno Nobel. The Company is a manufacturer and distributor of commercial explosives in North America and Australia. Dyno Nobel provides blasting solutions and quality explosives products, with over a million tons of ammonium nitrate capacity and 32 manufacturing facilities on 2 continents (including state-of-the-art initiation systems facilities in the United States, Australia and Mexico), throughout North America and Australia, as well as to selected customers internationally. In May 2003, Dyno Nobel and the USA-based Ensign-Bickford Industries (EBI) merged their explosives capabilities, creating the world's leading explosives solutions company. Both Dyno Nobel and The Ensign-Bickford Company (EBCo) have a major presence in blast-initiation systems and specialty blasting products. Read previous news nad stock recommendations for Dyno Nobel (DXL). Find out the meaning of the recommendations in this primer. Browse for other stockbroker recommendations. Check your charts and good luck with your share trading!