RE: Largo observation19 Jun 2020 10:42
Well @Evidently, I personally see no attribute to BE in the SP. Indeed, even the nomad model has just a cursory attribution.
AIM is driven largely by sentiment, but as Buffet points out, cash is king. He sought undervalued holding generating solid and growing cash to invest in. This is exactly where we are and eventually, this will shine through especially when dividends start being paid - although I think a small chance next year more probably in 2022 at the earliest.
Bushy may have two plants (a significant de-risk not really taken in by the market), but it mines Vanadium. Yes it can sell every gram produced and the price varying with a pretty volatile commodity, albeit with a solid and growing profit margin.
But it is a miner, small (relatively) and in SA. A country essentially held in junk status and widely seen as corrupt. The endless Eskom saga just shows how hard it has been even with a 400M+ free cash injection available from the world bank, just to win over the factions. It is happening, but slowly.
All the comparisons to Largo are in my opinion measuring chalk as cheese - completely different beasts (and yes, there is Brazil).
I can't get over my niggling feeling that as BE completes he Electro-plant, Orders start to roll in, that a re-brand as an energy solutions company in high tech would be of great benefit, as would moving to the FTSE where trackers can buy in.
Right now is all 'holding holding holding', and frankly I don't see much changing any time soon.
Where will the SP be in the future. I still feel 40-60 range is possible towards the end of the year with the right news. Assuming BE sells its full capacity next year and the following year, then how much in sales ..... just do the sums. The long held view on an SP at 100+ feels very probable in the next 18-24 months and after that as we grow to 8,400 MTV capacity + offtakes from Mokopane, then net profits of 100, 150M+ are perfectly possible.
So our collective 3.4M shares will remain on hold. The only ones I have to sell soon are my late mums (so a move to 20p+ would be handy for that).
HOLD HOLD HOLD !
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