LGDI is a "Legend" in its own time, you really need to look at this one

Back in early September of this year, I was doing my usual stock scans and came across a very interesting company.  I did a little research and found that I liked the company A LOT.  I blogged it, said to watch it because it was going to go up.  Guess what?  It DID.....a lot in fact. The price was around 60 cents when I first blogged it on the InvestorSoup.com website and in the matter of 10 days it reached a high of $1.11.  For those keeping score at home, that is an 83% gain!   

I have, since that time, continued to track it and believe that NOW is again the time that ALL my members need to be made aware of the company.

Ironically, the thing that caught my eye first with this company was not its sterling prospects, its strong financial condition or the quality of management, but the NAME.  I had seen a movie several months earlier called "I Am Legend" with Will Smith.  A great movie and one well worth seeing. 

Well, when a company called Legend International Holdings, Inc. (LGDI) came across the screen, I was curious and followed up....I am glad I did. 

LGDI is a phosphate mining and exploration company whose projects are based in Australia. LGDI's current phosphate interests are adjacent to Mount Isa, in the Georgina Basin, Queensland Australia. LGDI is working aggressively to develop and mine its phosphate deposits, with a phased implementation plan to become one of the world's leading suppliers of Phosphate and Fertiliser products.

LGDI claims to control a significant strategic portion (5.2 million acres) of the Georgina and McArthur River Basins in Australia’s Queensland and Northern Territory, which are highly "prospective" for phosphate (as the company calls it).

LGDI and Phosphate

Phosphate is not exactly a "sexy" commodity like oil or gold, but it is valuable nonetheless.  In order to produce high yields for farmers, crops need large amounts of the three primary macronutrients--phosphate, potassium and nitrogen

Nobel Peace Prize winner Norman Borlaug was once quoted as saying, “This is a basic problem, to feed 6.6 billion people, Without fertilizer, forget it. The game is over.”

Phosphate is a key ingredient in fertilizer and other industrial products.

In order to understand the chemistry of phosphate and the scope of the company's holdings, I recommend that you review their site.  This link is a direct link to their projects 
page which gives a great deal of information about its prospects: LGDI Projects Page

Finances

LGDI is not just any exploration company....It has an extraordinarily strong balance sheet.  I strongly believe the old saying, "You are known by the company you keep"......If that old saying is true, then LGDI is in great company. 

Here is a list of investors (individuals and institutions) that hold significant stakes in LGDI.

And, yes, it is that GEORGE SOROS that is one of the investors in LGDI.  IFFCO is the largest agricultural cooperative in India (one of the biggest markets for LGDI's phosphate and projected to be one of LGDI's biggest customers).  And, Parella Weinberg Partners are a multi-billion dollar global private equity firm. 

The capital that has been raised from these and other investors have given LGDI a "war chest" that the company believes will be sufficient take them through this phase of exploration and mining.  The balance sheet as of September 30, 2009 lists cash balance as A$ 78,024,637 (at today's exchange rate <0.935078>, that is approx. $73 Million U.S.)  No long term debt, either.

I can't remember ever seeing an exploration company so well capitalized.

More Good News

LGDI announced yesterday that they had inked another deal with a major supplier/investor:

    LGDI Announces Strategic Alliance With Wengfu Group Co. Ltd, One of the Largest Fertilizer Producers in China

Much in the same way that IFFCO has partnered with LGDI, Wengfu is working to close on a deal with the company.  This agreement will have Wengfu providing technical and logistical support to LGDI to speed their mining and production efforts and will cement a supplier relationship with Wengfu for LGDI.  In addition, Wengfu is expected to become a financial investor in LGDI, too!

Read the full release here: LGDI Release

It almost goes without saying that LGDI is a very interesting natural resource play.  It is a commodity play that has a huge potential.  It also has an attractive chart to go along with it.

It appears that LGDI might be prime for a bounce. 

• Yesterday saw the company break out of its base with higher than average volume
• The MACD continues to strengthen....it is not quite a bullish signal, but the bearish signal is weakening considerably
• The stock is bouncing out of oversold levels and appears to be under accumulation again.
  

Regarding my previous blog on LGDI, here is a link that you can follow and read to see that I am not making this up: LGDI Blog

I believe that it is time for my members to take a look at LGDI.  The chart shows that it is a very attractive opportunity, but what impresses me is the strength of the company.  To my mind, this is a stock that might have a near term "bounce" in it, but it should be kept on my members' long-term radar as well.  Once LGDI begins mining (and later production), the stock could be HUGE!

I will end this alert by using the last words from my earlier blog:

"They are confident bordering on cocky. Here is a little blurb from their site:

“Legend plans to produce an average of 5 million tonnes per year of phosphate rock concentrate of 30%+ P2O5 by 2012, thus becoming one of the world’s leading producers of phosphate rock.“

I am rooting for them.  I like their bravado.  It is said that “it ain’t bragging if you can back it up”.  Let’s see if they can back it up."

Remember to do your due diligence right away!  This is an awesome "Radar Stock"....all the way!