George Frangeskides, Chairman at ALBA, explains why the Pilbara Lithium option ‘was too good to miss’. Watch the video here.
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If it does dip, I will top up, then slice a lump on the rise.
It's still too soon and other stocks actually make money. We are still a gamble, in world a wash with money.
This week the volume is down already and it is primed for 4 or 5 short sellers to sell on low volume which could move the stock down easily.
Excellent post Starchild!
@Starchild - appreciate your informed posts.. Thanks
We can look at recent precedent to predict a company’s share-price.
1. The high of 5.6p on 26/2/20 and market cap of approx. £123m, was at a time when PoO was c$50/b and…..
(a) The drill ship contract was about to be signed with the intent of doing the Percy-1 spud ‘in a few weeks.’
(b) We had two massive CLNs about to be tapped when required, with no other sources of funds other than a potential farm-in.
(c) There were approx. 2.2 Billion shares on issue
(d) Analyst/brokers predicted 8p SP leading to spud.
2. Today we have approx. 3.4 billion shares on issue mainly due to the CERP merger. Yet….
(a) We have a drill ship contract signed.
(b) We have a firm spud date soon after 5/12/20 which is only 12 weeks away.
(c) We have other sources of potential funding including Stena and a major farm-in. And have more time to do so compared to February.
(d) We have potential access to corporate finance as we are now a £100m+ market cap company. And have more time to do so.
(e) We can potentially leverage CERP assets to borrow against (with no dilution at the asset or share level). And more time to do so.
Analysis
Based on all the above points 2 (a) – (e), I would argue we are in a much BETTER position today compared to points 1 (a) – (d) when the SP peaked on 26/2 at 5.6p. As a side point I believe PoO is irrelevant for this exercise unless it suddenly hits $75/b+ which is impossible in a few weeks. Theoretically If it did, all the above could be on the cards at better rates. But let’s get back to real world and do some maths…..
For us to get to the 5.6p interim peak (I’m not talking about the SP surge after that), in the absence of CERP news whether positive or not we should take into account £20m of BPC’s market cap, which means 0.6p of the current share price is CERP and nothing to do with the Percy-1 Spud. This means £123m (as on 26/2) divided by 3.4 billion shares today = 3.6p PLUS 0.6p CERP = 4.2p.
IMHO, I would argue we are in a much better position today than on 26/2 and even WITHOUT news, the SP should be much higher than 4.2p today before soaring further on news. I don’t think the markets have figured this out. YET.
Starchild
xxx