Member Info for wasarunner

Every which way I turn it, I struggle to come up with a number under 50p in 4 years time, taking the calendar year and as the milestone - e.g. December 31 2021 being the datum. I am trying to construct an equation which gives me 10p share price appreciation per year every year from the end of this year, and I pretend in my calculation that finance isn't yet in at 31/12 but we are 10p. Of course, finance will be in, and I do believe we are above 10p.

So the below looks pessimistic to me:
Oct 21-Mar 22: 10p (Araguaia becoming financed)
Oct 22-Mar 23: 20p (Araguaia midway through construction, Vermelho DFS is being progressed, licenced)
Oct 23-Mar 24: 30p (Araguaia 1 has been constructed, Vermelho is DFS complete)
Oct 24-Mar 25: 40p (Araguaia has a solid year of production behind it, Vermelho has a JV and has financed)
Oct 25-Mar 26: 50p (Araguaia stage 2 financing done and Vermelho is being built)

The reason I think this is pessimistic is as follows:
- Vermelho should add more value to the valuation earlier in the lifecycle, as it is such a huge project with massive economics
- nickel price upside. The above is probably possible at $20k/t. I am increasingly of the opinion that in the timeframe we care about, we really should be thinking about $25k-30k (or more)/t
- Vermelho WILL be accelerated once the partner is onboard. So actually on the above I think the timeline for Vermelho is pessimistic as well as the value add

So where does this bring me? At the risk of sounding like a stuck record, my thesis is as follows:

IF an investor can keep their money in this stock. And IF the company doesn't get sold. A 4 year wait will result in a minimum >5x upside.

I have absolutely no control over whether the company gets sold, but I have full control over how many shares I own and retain in this company. When I look back at what I did I spent basically best part of 2.5 years straight accumulating, to a peak holding >25m shares which at the time was around 1.5% of the company. Since then I have de-risked and inc family retain ~20m shares. However, in the last 6 months, I have ensured absolutely and without any further doubt in my mind that I can achieve all my other goals in life in the next minimum 4 years and not have to touch these Horizonte shares.

The real value I believe will come 2025-2030. The only prediction I make is, if we are still independent in that timeframe, our SP will be north of 50p because I cannot for the life of me, based on my own expectations of the nickel price and what I know about our assets come up with a lower valuation by that point.

For some people 5x on a 4 year view might not fit their investment criteria. They absolutely fit mine, particularly as I think we will be substantially de-risked in the next 0-2 years. GLA

If they miss end Sept does it affect much (assuming it comes in October)? No. Does it present a buying opportunity? Yes because traders will sell. Does it affect VWAP if so? We don't know because we don't know if VWAP is to be used.

Musicman it is, ironically durham just had a huuuuuge amazon warehouse completed. There is sadly a lesson there to embrace change. On horizonte that is what we are doing, this commodity is going to be in demand through the coming energy revolution. I noted an interesting post by someone I follow on twitter saying the biggest mistaje nlw would be selling early. If you believe the macro and you have the time this should be given as much time as it needs, second half of this decade is my best guess. I got time and will be waiting. Gla

https://twitter.com/wasarunner1/status/1441787105487712263

a risky ramp from me.

Interesting that you prefer to analyse the contributors to the bb rather than the company, on a Saturday. Probably not the path to riches but wtfdik, I am an idiot who likes paper wealth after all. The nice thing is we don't have to share the same opinions, I think 30p, Bwana thinks 80p, the other geezer a month or two ago thought 2.5p. It takes all sorts to make a good discussion...

John you can forgive us for 'ramping' a share which has already 5 bagged for some of us BEFORE it got financed BEFORE it built the first of two mines and BEFORE nickel ran into serious deficit. I dont mind saying here I am up paper 7 figures so I think some 'ramping' is warranted. We're happy that's all. In my case my pint in the cheviots helps but there is really a lot to be positive about here, looking forward next 3 weeks-3 years. Gla

Just carching up with posts at a mictobrewery in the cheviots. My glass is half full (literally and metaphorically speaking). Luke2 please dont go, we love you in all your bb incarnations! I was gutted when we lost owlo and our regular brazil/covid updates. We need the 'ol' guard pardon the pun. Gla

Respect - you identified a. that Armadale would buy and develop a great graphite asset and that b. in 8 years later graphite would be a really important component of the EV revolution. Talk about calling it right (maybe too) early! Rewards soon for you I hope - meant genuinely.

Yes sorry it was a general point on the T/O and not specific with ACP but I have seen elsewhere people say 'wait till production' and plenty of miners that isn't good advice - explorers do get the best assets bought up. I agree ACP is unlikely to be a target, at least not until it is producing.

On project level finance - the $39m or so capex and the IRR of the project I think make it a formality if you believe that then you should already be positioned for 'finance is around the corner'. It has taken Horizonte 3 years since they appointed their agent for finance to get the mine financed (and it isn't, yet). I think Armadale can do it around 10x faster. Of course when we know those terms you can assign a proper NPV/share value to the stock but expecting to buy after that gets announced you have to expect to buy at a higher price. So if you believe finance terms will be good, buy now.

Notwithstanding the offer that comes to buy the company. There is always a % chance of an offer coming at any point, then you can wait for production all you want, if the company gets taken out at some multiple of the prevailing shareprice. Got to be a serious chance of that in the coming cycle for commodities, I'm not singling ACP out as a particular target here (till at least production), but majors will be looking to buy good assets all the time...

>>"If you haven’t got a 1-2 year view to hold this share you’re in the wrong share"
I agree
>>"we should be at many multiples from today’s price but this will only come once production is flowing"
I disagree

Markets are notoriously imperfect and AIM is notoriously less perfect than other markets but we CAN be at multiples from todays price well ahead of production. As others point out, this may require PR, it may require offtakes, finance complete whatever and is never guaranteed. But I firmly believe the time to take a position is early and waiting for production - you are NOT guaranteed an entry. Not below multiples of todays price.

That's two separate things:
- what to communicate after the event (mining licence formally awarded), and how and
- what to communicate as a process is taking place
With the ML they can't communicate the process as it is taking place because until the ML is formally confirmed it is pretty irrelevant what stage it is at - the company can't mine. With the offtakes and so forth these are obviously highly sensitive discussions under NDA and again - you can't communicate progress (except at very high level e.g. HZM saying 'offtake discussions advancing well'). With legally binding agreements you announce them when they are - legally signed.

The other point is once signed then you can shout about them, obviously. Should they have made a bigger deal of PR on the ML? Maybe but if the other news is soon and it is big news it probably doesn't matter too much. Certainly enabled another 'top up' which I took gratefully.

One day I hope to get to 3% on a stock just to say I did it :) I'm sure others have managed that I never have. I got comfortably above 1% in HZM and ACP. I have tended not to invest in nanocaps etc. GLA

But money where my mouth is, I will take another 4m shares end oct if we are still at this price. Happy to help clear Kabunga and any pi's of a nervous disposition. It turns out you might get buyers as well as sellers in this stock - it is very good value presently with the permit a key de-risk.

Not producing profit is a bad reason not to buy a stock. Tesla are barely profitable and dont they have one of the highest mcap in the world? Its future profit you buy for, essentially in this case, can mb finance the mine this year and build it next to unlock $500m npv. I believe he can and better, I believe he can do it with minimal further equity dilution. Hence another 1m yesterday for me and up to nearly 8m shares - £30m mcap is too cheap.

Entry price is important but much less important if investing with multi year view, the only kind of investing I am any good at. Gla

Apparently they like someone else building it for 2 years. And at the end of it buy it for 3x what they could have paid in y0. No idea why thats a good thing but there you go....let the junior tackle the hurdles risk I expect

I bought a bit under 1m today in 2 transactions. I can't remember his numbers precisely but I think it will get soaked up now it can't continue to be significant forever especially if we get the kind of progress we expect here in next few months. Kabunga should be less of a factor going forward.

I must confess I dismissed Teck (maybe wrongly) as being the strategic because afaik they are not a nickel developer, however something pp said has definitely made me question that. By rights they should have dirst dibs here to make an offer - highest shareholding and ned on the bod. As others have said Glencore would like offtake and maybe that will do them, effectively an agreement between teck and glen. That would be interesting not least because Teck can't add as many shares and not cross 30% by my calcs was 11p and 14p min equity price respectively on the $100m and $50m/$0 to others calc assuming all equity . So definitely a challenge to work around maybe offtake helps there.

I don't mind Teck indeed I think it would be very favourable on dilution front, my money is still on a miner, I guess one of the twi existing, so question in my mind is which one. Exciting times. I am sure neither Teck or Glen being the strategic is baked into the sp right now.

For me, the T/O would hopefully fetch a higher price than 25-30p though. Rationale there is, by then, the market should be pricing some for A2 and V, and if A1 is already worth 40p at production, maybe slightly less before then. A buyer would have to pay some premium. And if nickel price has risen in the next 2 years hopefully so has Horizonte's shareprice. So hopefully we are already at 30p when they make an offer and they can't buy us for a paltry premium on that number.

This is where 'who the strategic is' gets interesting of course because if it is the eventual T/O then they can probably buy us slightly more cheaply as they can offer on 70% of the shares and need whatever % to accept the terms of the deal. I think it becomes difficult for someone else to buy it, if, as PP says, a miner like Teck (or for that matter Glencore) are the strategic investor and they hold the 30%.

Hi GLR I nearly replied on twitter but I'll reply here. For me 'ideal scenario' is 2.5bn shares in issue including options. That would mean 700m new shares, which would probably need to be at 10p+ to raise ~$100m USD with the balance coming from offtake / debt.

The key here is, the deal doesn't have to be 'jackpot' to still be a very very good deal. Is the jackpot possible? Not sure. So I'm really happy with 3bn shares.

To PPs post on valuation, I think T/O still likely who knows the price and when it happens. I got excited at the 150p valuation when I realised that would be an '88 bagger' on the ones I picked up in the dark days of City Financial selling down. Like PP I don't think we'll ever get that far! For my money the T/O happens close to, or at, Araguaia first production - it is the obvious timeframe and by then Vermelho should be DFS + permitted possibly.