Shorts still have time on their side imo as there will be no cash coming in until at least July 2013.
You can produce all the samples in the world, but until the reality of "sales" being achieved and proven over a sustained period, the shorts will have time to cover imo.
As it is the ramp up to 11,0000,000 will not be achieved possibly until later in the year, so only then or into 2014 could you start to base the SP on sales at that form of sale rate,at say 915,000,000 per month, although I tend to say 90% of nameplate is more suitable even at maximum.
If you can get a gauge on the monthly sales output then the SP can start to reflect true earnings.
If we presume sales at say:
next 2-3 months at 0% of monthly sales maximum 4-6 at 40% 7-9 at 60% 10-12 at 90%
June $0 sales profit July $70 mill Aug Sept October $109 mill Nov Dec $198 mill
Then need to allow for possible phase 2 sales in the equation which I havent used, so would be a bonus.
Allowing an SP of .42c for plant, .20c for resource and sales profit for the rest I come up with as an SP estimate based on a $20 profit margin.
SP June 62c - 80c Sp July 1.04 Sp Oct 1.30 Sp Dec 1.62
I personally think the SP first "major rise or rerate " will come between June and July 2013, with continual improvement from then on.
For this reason we all have between now and say early June to get set, and that includes the shorts to cover, before a first decent spike.
LYC Price at posting:
61.0¢ Sentiment: None Disclosure: Not Held
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