Depends on which REE are in the Mix and the $Values used for those elements but you get the idea. It has a high probability of good value even if sold on. The costs to mine would appear lower for Glenover are likely lower than the other one - cheaper cost of labour, mine plan likely simple - pit etc but you get the idea - it has value - and assets are now getting bought up - with one less on the market just there :-)
"1. The rare earths scenario is based around a resource of just over 10mln tonnes of ore grading 2.13% total rare earth oxides, and envisages production of 167,100 tonnes of rare earths over a 24 year mine life. The project, as evaluated in 2015, has a net present value of US$512mln and generates an internal rate of return of just over 34%."
"2. Announced today - a 2018 preliminary economic assessment on Kwyjibo projected that with a $723.6 million investment, an underground operation with a mine life of 10 years that could produce 174,000 tonnes of concentrate at a grade of 7% total rare earth oxides (TREO) per year. The study projected a post-tax internal rate of return of 17.8% and a net present value of $373.9 million, using a discount rate of 8%.
Now - the second one is also a much trickier project - huge capex to get it going for a start - whereas we have a nice big stockpile ready to start things off. Not only that - we can sell the phosphate and if CB does the right deal - keep the rights to to the REE. Add a significant $multiple to that IMO.
Also - POW bought the REE project off Kvango for £150k - purely a license to prospect - very early days. Whereas we have a discovery. So Glenover, a non-core asset that could be worth a multiple of our market cap even taking in to account the % we own. CB will likely do a very good deal on that one IMO.
"If we look at profitable companies in the mining sector with an EBITDA > $10m then we get (trailing) PE ratios (i.e. based on the balance sheet values): Func PE AVG 11.87 MIN 2.86 MAX 47.87 MEDIAN 9.06
However, this includes the likes of BHP etc which skew things due to their sheer size. So if we exclude anything with a market cap over 75m (to keep the usually smaller companies) then we get:
Func PE AVG 9.07 MIN 5.46 MAX 15.84 MEDIAN 8.62
The MIN coincidentally is JLP."
If the latest Hot Stock Rockets forecast is ballpark correct then on a $10m p.a earnings that's a multiple of about 2.2, and on a $5m p.a it's a P.E of 4.4 which are both lower than the 5.46 low of JLP which is low for the sector/market cap range.
This HSR estimate therefore feels very prudent to me (good) for GLR when it becomes a cash earning company. I also think the PE for JLP is low given that it costs you less to buy a dollar of earning power from JLP than other companies - and that dollar is welcome with the same purchasing power in most places :-) (I also own JLP for clarity)
Add in Glenover possibilities and the rest of the story PE is likely to be much higher IMO. That translates to a good multi-bag from here. Those castle gates keep getting rammed for good reason IMO. DYOR. GLA.IMO.
LR has said a lot of things that have made me cringe when it comes to the market. I expect execs to understand the importance of increased market valuation - proving that the work they have done has added value - especially in cash munching juniors needing to dilute at hopefully higher SP. The Manchester evening had some great information - but there was the chat about, broadly, the market getting it right... presumably he thinks the market has got this right. I do not.