I am really tempered to buy 120k, I’m trying not to over expose myself, but the market will wake up to this when they know the drill bit is turning by at least 50/100% the current price imo.
Mmmmmm, the art of discipline.
I’m not sure who is selling but I think they have lost the plot. The churn has been good to increase the average purchase price across the register, but with the upcoming newsflow, this is only going one way. Fully diluted market cap of £55m odd is far too low.
If the two majors find what they expect in terms of tones their is no chance that they will let OMI be part of the equation. With its current market cap, it’s a sitting duck. They will simply takeover the company, they will not want it to achieve what GGP has achieved which is more than possible should they just let it run on its coattails.
I can’t believe what I have just read in that IC article. His opinion as a trader has been printed, why, what makes his opinion any different to my opinion or yours. Yet his advice will be read as exactly that, advice.
Oh dear.
They did indeed, but I expect them to continue to add if madness continues. I wouldn’t get to stuck on the auditor news. It’s oversold, we have a gap to close and the business is a high growth, profit making machine.
I will focus on the underlying business model and the accounts, which as an investor is my job.
Last director purchase on the 16th July saw a rise of 20% on the share price by the end of the following trading day and just over 50% within a month.
Time for the market to focus back onto the most recent earnings which were extremely encouraging by any metric.
Look forward to a short squeeze in the morning as many who were short were targeting/hoping for 200p. Time to close the gap imo.
Shareholders can sleep well tonight knowing those shorts are going to burn.
Market presented an opportunity to purchase a high growth company that is fundamentally hedged against a lockdown due to its online presence.
Boohoo a winner from the Covid virus, unfortunately the high street a loser.
Enjoy your conviction hold or purchase.
https://www.google.co.uk/amp/s/amp.ft.com/content/3cbd2893-ee4b-47b7-a4e5-2cd1b95b5a31
It would appear, the same pattern of transferring stock from AUS to UK with another 450k shares dropped into UK market this morning.
I could be wrong but it appears to be the only explanation.
I think the UK ESG funds are hungry.
https://www.cnbc.com/2020/10/19/citi-stock-picks-to-buy-and-sell-on-chinas-ambition-to-go-green.html
It’s like a big global puzzle.
Companies that are now zero net emissions have seen a 15% increase in their market cap. Multi funds such as ESG funds have significant money on the sidelines looking to deploy. Problem the world has is it immediate access to NdPr.
Global attention will soon be on this ignored resource.
https://asia.nikkei.com/Politics/International-relations/US-China-tensions/China-passes-export-control-law-with-potential-for-rare-earths-ban
And so it begins, in the same way that it did ok the last spike, here comes the strategic battle for Rare earth materials.
At 6 year trading high and up 5% on the day so far.
As I have mentioned before, I think we can expect this to be a full blown exploration campaign operating alongside the main prospect field development.
Although an early indication, Coola Carbonatite demonstrates an ROE of 2.99%. Early studies (1999) suggested an ROE of 3.64% in comparison to the Longonjo project with high grade intersections with an ROE of 2 to 4% (Jorc report 2020).
In other words, their is a growing probability that we have ourselves another Longonjo type deposit.
I have looked into other mine developments, the IRR, the EBITDA, mine life, free cashflow, mine construction lead time, types of financing.
Without going into to much detail, a majority of the projects required a very high level of financing by comparison to Pensana, the projects therefore led to greater equity dilution and the mines themselves were not strategic in nature as they are two a penny, gold, potash etc.
I think given the nature of the project and working on the numbers from the PFS alone, it is clear to me that a lul in the share price is extremely unlikely. Mine construction is due to commence after the Chinese New Year and I expect the mine to take 14/16 months.
Although early doors, a future P/E of 12/15 would seem reasonable, and if in December the EU decides to commit to the 55/60% emission reduction by 2030 and that Biden launches his $2T green stimulus package. NdPr could well be the new Gold, but on another level given the low competition.
Another box ticked and the institutions will just keep adding, maybe on another level after the BFS as they close the gap between its peers, Lynas and MP materials.
To be released in 13 minutes
Do you have a link to that chart China?
I totally agree that this company appears to have a very competent board at the helm with a very good track record.
What has helped the cause/share price is that the company have started from a very low base. Represented a return over the last 6 to 9 months that appears astronomical but was assisted by the Covid meltdown and the sector being overlooked. Name me one other company that is investable in Europe that is this close to mine construction with such a low cost base?
Many investors I have spoken to have turned their head on the basis of performance to date but the NPV from the BFS will be made up very quickly imo. Paul mentioned in an interview that they are targeting mine construction in less than 18 months from start to finish. With the Chinese at the helm, that is more than possible. Just look at how quickly they made those hospitals back in Feb/March.
Another key to all of this is the level of dilution to share holders, unlike when Lynas who got their mine off the ground and into construction via significant equity financing, favorable financing is now available and we have a sovereign wealth fund to boot. The key being dilution, of which I expect a maximum 20/25% dilution and reasonable discounts to current share price. Typically 10% rather than 25/30%.
Timing for this mine construction couldn’t of come at a better time. By mid 2022 this company market cap will be a minimum £1b. That’s approx 5x from here and the potential to be significantly higher than that, if the material price increases as expected. I personally expect to see a market cap of £3/5b by the end of 2025 15/25x return. But that’s just my opinion/expectation. As you say Verde looks more favorable than its current near term prospect looking at the company website. We have a massive Angolan based miner in the making, what comes first though, the Divi or the takeover?
If you get the opportunity to look at the timeline between commencement of mine construction and commissioning of the plant, in addition to the processing facility which in our case would be in the UK. All be it during a favorable price environment which is now recovering and expected to grow steadily going forward, bar some geopolitical strategic decision that could send the price stratospheric. It is clear to see that the most profitable period to hold Lynas was throughout mine construction and first first ore pour.
I think this board can learn from delays that increased dilution during the process facility construction due to objections from Malaysia by getting the relevant permissions necessary before construction. It must also be remembered that the environment for NdPr since Covid and a political push towards a green future has somewhat changed the landscape for such projects.
With favorable funding and institutional investors/corporate bond holders waiting in the wings with government policy aimed at reducing barriers to entry and ensuring incentives are in place.
This is going to be one hell of a ride. The more I research the more I like. I will be sitting on my hands for the next 4 years and will reap sufficient dividends from my investment in an ISA to retire. I am convinced of that.
At what point will the biggest global miners such as Rio Tinto want to get involved, my guess is fairly soon.
Biden promises a $2T climate plan.
Trump signs an executive order to target rare earths.
Europe have set up the REIA to reduce dependency on China and ensure the materials are mined in line with ESG policy. (Sound familiar).
This storm in a tea cup can blow up at any point and GLOBAL leaders worldwide are repositioning in anticipation.
It’s all their to be read, it’s all in the public domain, it’s just not mainstream, YET!
https://www.google.co.uk/amp/s/stockhead.com.au/resources/the-ev-metals-super-cycle-is-coming-and-the-funds-are-eyeing-the-juniors/%3famp
“The EU in particular has been extremely vulnerable, particularly with COVID, and COVID has only highlighted an issue that was already there — that they are 100 per cent dependent on China for supply of their rare earth magnets.
“The Europeans are very animated at the moment about looking for initiatives to remove supply chain risk for the future because they’re fearful that they’ll lose all their manufacturing capacity, and the auto sector in particular employs about 15 per cent of the workforce in the EU, which is obviously significant.”
This perfect storm of rising demand and tightening supply has prompted Acorn Capital to launch its new NextGen Resources Fund, which is focused strongly on the EV metals.
The new fund will have financial capacity of between $50m and $100m for investment into 25-40 Australian and global equities with a minimum market cap of $10m. The fund, which also has some allocation for start-up/pre-IPO companies, has a three to five-year investment timeframe and will be benchmarked against the S&P ASX Small Resources Accumulation index.
Hi B_M,
I agree that it is very important to minimize dilution, however in 2018, £3m covered working capital and a 9000m drilling program, a program that has to date yielded a significant level of return for shareholders.
Dave Hammond has suggested that the Coola block has the potential to increase production. Removing a relatively small top soil to expose the mineralization and truck to increase capacity could be an easy win with a high rate of return.
With various other prospects on the block including gold, it’s possible to see a JV for those types of prospects given the amazing infrastructure and sovereign wealth support. Opportunities are endless as a first mover in the country and it’s very difficult not to get excited.
I am expecting a Coola block update next week with an outside chance of an off-take agreement. With the BFS at the end of the month attracting significant institutional interest.
With the key to avoid dilution being a higher market cap, MP materials will attract a significant level of interest/traction which will only serve to increase wider investor interest.
Have struggled for stock today, price monitoring extensions are a proof of this. They would take all my position off me at 89.3 before close. They will either UT 180 shares at 85p to match AUS it close at 90/94 imo. But don’t be fooled, this is looking good with lots of newsflow in next 2 weeks.
CHIEF OPERATING OFFICER DAVE HAMMOND COMMENTED:
“Our main focus is on completing the current programme at Longonjo and reporting an upgraded Mineral Resource estimate for the DFS, which is expected to significantly extend the mine life.
Having received the Mining Licence for Longonjo our plan is to capture and test the high potential brownfield opportunities within trucking distance of the proposed treatment plant which have the potential to increase overall production.
The Coola and Monte Verde carbonatite complexes are of similar size to Longonjo and have been identified as being rich in NdPr mineralisation.
We are very much looking forward to getting on the ground with the first round of exploration on these exciting new targets.”
The key being, potential to increase overall production as the Coola and Monte Verde prospects are said to be as big as the Longonjo prospect.
Just think about that for the minute.
I think from the most recent interview it is clear to see that the Chinese are happy to diversify their production facilities outside of China. For me it doesn’t matter if the production facility comes from foreign investment (Chinese or American) or the U.K. for both U.K. based and European NdPr demand. However this mineral has become strategic in nature.
https://www.greencarcongress.com/2020/09/20200929-adamas.html
https://www.google.co.uk/amp/s/moneyweek.com/investments/commodities/600729/the-rare-earth-metal-that-wont-be-a-secret-for-long%3famp
Currently considered as the best kept secret to being able to fulfill a green revolution, the coverage of this material at some point will be on a scale not seen before. In turn we know their are very few well funded near term production plays that will be able to facilitate this demand.
Imo it is possible that they can serve the demand of multiple markets so as not to put all their eggs in one basket. We have seen the pentagon making various strategic investments, including to help fund a new process facility in the US with MP materials. What’s to say they won’t make an investment in Pensana given that they will become one of 3 independent miners outside of China that can facilitate its demand. We are seeing countries and large companies such as Tesla making these strategic investments, something is brewing.
Not only that, but the market is drastically underestimating it’s current upside potential in terms of the deeper NdPr rock below the weathered surface, and the Coola Exploration block, with each and everyone of the 10 prospects sharing the same infrastructure benefits of its main prospect. I think it has the potential to make Pensana one of Africa’s leading miners. Is it possible that the US provides the funds for them to pursue one of the 2/3 rare earth deposits on the Coola block, time will tell.