Hanging on a thread 'technically', page-4

Fosters is one of the great buys in our market today:

1) The two largest shareholders bought another 50m or so shares (US pension funds).

2) Consolidation in international brewing evident with recent merger activity.

3) Fosters is the fastest growing beer brand in the world + royalties start to kick in this year based on volume sold not a fixed amount. Fosters sell more beer overseas than it does in Australia, profits have been subdued as they don't actually brew it but get the royalties from other brewers.

4) Fosters labels VB is the strongest domestic beer brand in the world.

5) Beringer brands selling well as they are in the premium end of the market. Currently US citizens consume very little wine and the trend in western countries has been massive growth.

6) Fosters management confirm that cashflow will return to 400m+ this reporting period + sales are performing to expectations.

7) Prospective PE of around 15-16 depending what reports you read, pretty good for a growth stock. Compared to someone like Telstra, Fosters wins hands down.

So if you listen to the chartists who say the next move is $4 I would say they're crazy. The only way it will get there is via a massive slump in global markets but in that case every stock (except asc) will go down.

I bought some Fosters shares and will hold till at least this reporting period is over... my target is 5.50-6.50 per share.

Cheers,
Munch.