TRQ - Turquoise Hill: More Questions Than Answers

• Rio Tinto's recently signed MOU for re-profiling of TRQ's existing debt is not welcome news for equity holders and is certainly taking a toll on TRQ's share price.
• Time and again, we have seen that RIO's role in Oyu Tolgoi's development has adversely impacted the stock despite the charm of the mine's underground portion.
• While RIO's interest in the property is well protected through its representation on TRQ's Board, the minority shareholders are made to suffer yet again.
• The 10:1 reverse stock split provides potential for further downside and may prove to be a trap for new investors.
• TRQ is a long-term 'buy and hold' that trades at an attractive valuation, however, a short-term 'momentum' trading strategy could be risky.

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