Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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Tray, I admire your faith in the company and you write good reasons why it’s a good investment. But what people want is a profit, a lot of people day trade these aim stocks. This company doesn’t even move 10% -20% no money to be made. Started off 3years ago at 3p since then down it’s gone, lots of people caught the falling knife. We’ve had dead cat bounces and that’s it.
Good luck
I think most of us here on the chat are long term investors. Here's hoping by the summer or later in the year you are right doc and we are alot more above 13.00. I think news from the Uranium; especially if it's a JV, will give us the boost we need. Molopo; let's hope the assay results are above our expectations. I think where the sp is right now, a poor result is already built in. I can't see too much of a drop from that
Doc83 - Beat me to the inefficient market point!
Not bothered about short/medium SP swings as the market place is inefficient in its nature. If SPs moved up with every piece of good news and down with every piece of bad news, no one would invest in anything. You make you money in the stock market when it acts the most inefficiently in my opinion on both sides of the spectrum. Buy when its obviously undervalued, sell when its obviously overvalued.
I look at the SP solely on a "what can the business prove" basis. At the minute at 13.25p a share in POW that's a £14.6mil market cap. Theoretically if a liquidator came in tomorrow, they would have very little problem getting £14.6mil into a bin bag of cash. Therefore I'm a buyer of a stock in this position.
On the other hand, take 2021, the POW market cap spent a good chunk of time above £30mil but a liquidator would have had a tough task getting even £3mil into a bin bag of cash at any point in 2021. AIM loved it, the PR companies pumped it and investors got suckered in with their covid money in their bank accounts.
U asset deal talks are happening, a Saudi IPO is in the pipeline and POW's 75% stake in GSAe Ltd will bring in a bit of revenue (they made about £200k profit in the last 6 months of reported accounting data so circa £400k profit per year) .... none of this is priced in, not even a single penny. So if it all fails, no money goes into the theoretical bin bag of cash anyways so I'm no worse off. If any positives come from these projects, then the bin bag of cash will increase.
AIM retail only understand "the SP has gone up so the business is good, the SP has gone down the business is bad". Huge opportunity here to get POW at a remarkably cheap price, but that's only my opinion based on my own logic which has served me genuinely well so far over the past 10 years+.
Markets are inefficient. That's why we're here, to spot if something isn't priced correctly and make money out of it. I have high hopes that "this time next year Rodney" we'll be trading higher than 13p.
You are correct to say that POW’s business model tends not to be well liked in the UK because as we can observe the value of the investments is not properly reflected in the share price. However I believe the reason they have persevered is because it is quite common and well liked in North America. I have certainly heard Rick Rule and others say how attracted they are to this model because it spreads risk across multiple targets and has proved to be very profitable selling prospects on to bigger miners to spend the big money on development. As we know Rick Rule holds over 4% of POW and promotes it to US investors. Both POW and GMET have listings in the US and are having a big push on promotion to US Investors. If it works for Rick Rule I am happy to run with it.
As you said, if they were to sell up everything, they would be worth alot. Even the land alone is worth looking at. The investors don't really look into that though. I would love for Sean to keep the Uranium under pow as I said before. This project could be huge and would impact the sp and bring in alot more big investors to pow If they kept it under pow. Putting the whole project into 1 with a JV to cover costs would be the perfect move rather than a spin off that will have little or no impact on the sp here. A spin off is only going to force selling here to move over to the ipo which is the case you mentioned with gmet at the moment. If they don't get something in place under the POW we aren't going anywhere. Ever since the poor result at molopo and pj leaving his position as ceo. The sp hasn't gone back to its previous position under Sean yet!!
That's the million dollar question sol001 and arguably AIM isn't a good market at all to have a model like this because the average retail investor lives in a dreamland where they want 20-30x return on their investments in a matter of months because they see it happen on a couple of stocks once every 10 years. Most with deep pockets avoid AIM like the plague and rightly so.
Based on POW's listed investments, pre-IPO investments, cash in the bank etc. I put that at around £15mil today. Now JP2000 has indicted below that Molopo, Haneti, Tati etc. are worth "diddly squat" at the minute. Well I couldn't really care less if that is correct or not because the market is also saying at the minute they are worth diddly squat so they are in for free if you invest today. It's hard to put a value on them, but are they totally worthless? Package them all up in another AIM listed company and that AIM co could easily have a £5mil market cap most likely. Therefore by investing now, I am buying in at a price where if POW theoretically decided tomorrow they wanted to sell everything, they would have at least that £15mil market cap in a bin bag of cash (I stress the word theoretically)! Its almost a win/win in this situation when you have a solid £15mil balance sheet as you are investing at the minute in a business that the market say has no potential. POW have had their issues with a lot of their assets but I think there is some solid potential re their Uranium assets & Saudi IPO alone. Progress in both those areas also has £0 priced in.
Selling pressure at the moment is mainly coming from POW holders selling POW stock in order to convert GMET warrants. Again, that isn't hurting the POW investment case yet the POW shares get cheaper by the day because of it. Another buy indicator in my books.
POW hold 55% in GMET (will be around 50% once the GMET 10.75p warrants are converted). GMET therefore holds all the risk. POW holds very minimal risk and gets the cash free ride whilst getting half the rewards as well. My personal preference.
When you invest in a business that has nothing to show for its market cap apart from pure hype, AIM herd followers etc. then you know its going to end in tears most likely. Exactly what happened to most junior exploration companies in the covid years. Not currently the case with POW.
Bottom line here, if GMET has doubled but POW hasn't moved. All that does is strengthen the POW investment case for me. But that's only my logical view. AIM is anything but logical as we are experiencing across the board at the minute. That for me also has little to do with POW and more to do with Mr Market which is unfortunately out of everyone's hands.
The biggest worry for me here currently is that if POW can easily demonstrated in theory that they can put their entire market cap in a bin bag of cash tomorrow, I'm sure it must be coming up on a few radars for a potential cheap buyout offer.
Why is it that the sp has doubled at gmet and pow share price has dropped. I would be happy if the share price here doubled at the same time. We have a large percentage here and news flow hasn't impacted us. Yes the company is showing they are making money, but we the share holders are losing money at pow. When are these ipos going to make us money at pow shares? That's my question to Sean. I don't see the impact from any of these ipos released yet
I understand the importance of the Uranium for definite. This is why I want it kept under pow or as a JV. This will help us as pow shareholders. We need more investors coming into pow
I think you are underestimating the importance that will be placed on Uranium prospects in the USA. The Senate has voted to ban uranium from Russia and it’s gone to Biden for approval. Uranium in Nevada will become of Stategic importance to the USA and may well be eligible for Government funding in the same way that GMET is hoping to get Government funding for its Pilot Mountain Tungsten project.
When I say actual earnings; I mean by selling shares from the ipos or from royalties from discovery's
Sean keeps ramping up the ipos, but as Pete and JP has said, they haven't done absolutely anything for the sp here. Until we see pow reports with them making an actual earnings from the ipos it's not worth mentioning. I think we have a long way off until we reach the old sp of 1.90 we saw with PJ. Even 1.50 would be nice. I'm guessing with the current shares that would be 30.00+ The only way we will reach that sp is a great assay result from molopo and a JV for the Uranium project. An ipo for UEE won't do anything to raise the sp here; especially to double our current amount
I'm not ramping in the slightest PowerfulPete, I always just state a bunch of facts and figures based on accounts, financial data, RNS, comments from the board of directors, the company presentation etc.
If what I have put below in my latest comment is "ramping" in your view, then aren't you admitting its a good buy opportunity at these levels? All I have done is broken down the company's interests. If that sounds too good and a ramping spree, then it's surely an investment opportunity?
I'll come back to the comment I always state. When you were buying this stock a few years ago when the market valued the business at £30mil+ but the business had almost nothing to back up that valuation in terms of assets. Now you won't say a positive word about the same company which is now valued at £15mil with 6, 7, 8x the assets it had back then.
I think your concerns are therefore more with Mr Market rather than POW.
Agree with your views JP2000 this company was about exploring and finding something commercial to sell. Tray can ramp it all he likes, the IPO’s haven’t exactly bought any value to the SP. As you say hopefully GMET & FCM will bring something.
We wait in hope.
Why is POW worth less than the sum of the parts, could it be the conglomeration model went out of fashion in the 80s for good reason. According to POW's business model they count an IPO as crystallisation of shareholder value when it is nothing of the sort. I'd also caution against applying any value for Molopo, Haneti & Tati because they found diddly squat so far. The only thing to drive the share price will be commercial discoveries, GMET & FCM should come good .
Very informative reply as usual Tray. What do think we need to happen to put us back to where we were last years sp? Which in current shares is around 30.00
Any SP appreciation is good news for POW holders, even if the market doesn't say so in the POW SP initially.
POW market cap today = £14.6mil
GMET Holding (including warrants in the money) = £8.2mil
FCM Holding (now temporarily suspended so less liquid) = £0.5mil
UEE pre-IPO valuation = £1.5mil
FDR pre-IPO valuation = £2.6mil
VALUATION OF JUST THE ABOVE = £12.8mil
The market now values the following at just £1.8mil:
- Cash in the bank (probably £500k-750k)
- Molopo – Conductor hit at depth, assays to follow in the coming months
- Tati – Near surface gold found to date with opportunities for tailings processing for future revenue.
- 75% stake in GSAe - Future revenue stream (GSAe posted a 6 month profit for the period ended 31/12/2023 of just under £200k). So that £400k profit per annum before anything ramps up worth £300k (75%) to POW.
- Saudi IPO & future Saudi deals which Sean has stated are near. Sean also stated in the Proactive event a few weeks ago "the Saudi IPO will be POW's biggest to date"
- UEE IPO / U asset deals which are surely going to worth more than the UEE pre-IPO valuation of circa £1.5mil otherwise Sean wouldn’t have bothered listening to 3rd parties as announced last month.
- NBGC disposal worth up to £1.5mil as announced last month and £250k initially in cash.
- ION Battery Resources future IPO (contains POW's early stage Lithium assets)
- New Horizon Metals - future Aussie IPO which POW hold 20% of at present
- Silver Peaks (30% minority stake)
- Haneti (35% minority stake with partners Katoro Gold)
- Any upside from GMET as they move into a key Pilot Mountain drilling campaign with DoD funding possibly around the corner
What a strange strange market we are currently in!
Great news for gmet shareholders, when is this going to have an impact on our sp though. Today we are down again :-/
We do have news from our largest investment.
RNS from GMET this morning:
“ Pilot Mountain - Porphyry Target Confirmed
Geophysical Results Highlight Strong Magnetic High Anomaly Confirming Porphyry Potential
Golden Metal Resources plc (LON:GMET, OTCQB:GMTLF), a strategic development and mineral exploration company focused in Nevada, USA, is pleased to announce an exploration update at the Company's 100% owned flagship Pilot Mountain Project ("Pilot Mountain" or the "Project") located within the prolific Walker Lake Mineral Belt in Nevada, USA.
During the planned upcoming drilling campaign, the Company will be testing the 'Porphyry South' target with at least one drillhole.
Oliver Friesen, CEO of Golden Metal, commented:
"When we first conducted the Pilot Mountain Project due diligence, prior to acquiring it in August 2021, we were drawn to the possibility of finding a porphyry system which could be causative of the strong skarn-type mineralisation mapped at surface.
"The new magnetic geophysics results are highly encouraging, bolstering the findings of our previous IP survey over the Project's Porphyry South area. The juxtaposition of the magnetic and IP survey anomalies strongly support the need to drill test this promising porphyry style target.
"As we move quickly towards the start of the Pilot Mountain drilling programme, the 3D inversion modelling results will assist us in refining the strike and dip of the planned 'Porphyry South' drillhole for maximum impact.
"We very much look forward to finally drill testing this exciting target, which is just one of many others on our 100% owned flagship asset."
We need news here at pow. Even some updates from Sean on how the GSA, Uranium talks or Saudi Arabia talks are going. Molopo is going to be a couple of months yet. Super slow in Africa. FDR isn't going to do anything for the sp here. Only time these spin offs are going to help us is when pow sell up or make any money from the royalties of any big discovery's. We will have to wait and see in our half yearly results what cash pow has made
Got enough to worry about with the companies already listed
https://www.londonstockexchange.com/news-article/market-news/suspension-first-class-metals-plc/16449565
We might not have discovered any Uranium yet, but rising prices won't hurt none.
https://oilprice.com/Metals/Commodities/Uranium-Stocks-Surge-as-White-House-Considers-Russian-Import-Ban.html
GLA
Isn’t it about time FDR came to market? Never mentioned nowadays. Must be months behind schedule.
I have to say on this occasion LW, I concur. Which is why I bought into GMET rather than POW.