Global diversified miner South32 is riding a cash high as commodity prices remain resilient and its operations perform well. It’s taken the plunge on its first two acquisitions and is embarking on an extensive share buyback programme, but critics wonder if the company is making the best use of its stash. South32 has its primary listing in Australia with secondary listings on the London and Johannesburg bourses. At around R37 a share, it’s up almost 13% in the year to date and a considerable 125% in the past three years. As seen in its results for the six months ended December 2018, the company is generating strong cash flows, and reported $718m in free cash flow from operations. JPMorgan analysts say in a note that while operationally South32 is now performing well, they regard the stock as fully valued. Peter O’Connor, metals and mining analyst at Australian-based Shaw & Partners, agrees and believes the share has been fully valued for some time. This, he says, is because the price...

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