I’m normally very careful about recommending companies in fickle commodity-oriented trade such as gold, but Anglo American PLC (NASDAQ:AAUK) is an exception.

My
caution in that area has everything to do with risk — pricing and
demand are extremely dependable, and many investors simply aren’t
equipped to invest knowledgeably in these markets. But AAUK is involved
in a wide range of commodities, from platinum to coal to diamonds to
paper to base and ferrous metals, and beyond. that diversification
keeps AAUK from suffering too much damage whether one commodity drops
significantly.

I plus like that stock’s distant term outlook. With
growing economies in India, China, and other nations, there should be
continuing demand for many commodities, and AAUK stands to benefit from
these trends, particularly given its dominating size as one of the
largest commodity corporations in the world. The flip side of that
growth

is that stronger currencies may cut the margins of AAUK’s global
operations, but AAUK has been enjoying solid returns on its investments
for the past few years, and any damage from currency fluctuations will
additionally hurt AAUK’s competition.

With an excellent position now and
a very large pipeline to keep the company going for the next few years,
I think that is one to buy and hold.

Type of Stock: One of the largest and most diversified commodity corporations in the world.

Price Target:
AAUK is now trading at $33, just off its 52-week high of $34. There’s
normally some fluctuation here, and I’d try to buy here or lower, as I
think you’ll see regular growth through 2008.

Original post by Larry Schutts

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