Good News & Bad News, page-1390

Well, I got back in today. Just 50% of my previous holding though.

The PLS share price was very strong last week. It even decoupled from ORE and GXY. About time, I reckon. Even today it outperforms the Briny two.

I had to sell my holding in order to realise profit due to my tax situation. Its very much a grey area but likely adverse for me. Yes, I have professional advice. It cost me a few cents per share but the tax could've cost me ~25% of my profits.

I also re read my first post on the PLS Forum and remembered why I invested in the first place. I five bagged and made twice as much money as needed, so I reinvested 50% again.

I'd also been mindful of US inflation. Still a concern with the US Fed meeting this week. Its hard to pick entry and sell timing, that's why I don't trade but invest long term. If there is a market hiccup I'll disregard it because I have a long term outlook.

I never lost faith in PLS. I've been looking around for other opportunities, however I've already done the Company and Sector research here and it still looks good.

Certainly Nightflyer's shipping post underlines the great quarter PLS is having. Especially with pricing between US$650 and US$750. I watched an AVZ video. Note what the CEO says at 23.15:

https://www.youtube.com/watch?v=fCMqSpLhkDI

If/when Spodumene prices reach US$1,000pdmt or more (as Ken seemed to imply at the Strategy and Outlook Session recently), the share price upside here, looks considerable.

PLS is shipping as much as possible during the current quarter. This must include inventory on hand. Next quarter they will ship only what's produced and that should influence Spodumene prices.

I feel the current quarter's profitability (given shipping volume and Spodumene prices) values PLS at a P/E of ~40. Its high but not compared to others in the EV industry like CATL, Ganfeng, etc.. Also production output is forecast to double from Jan22, which should lower that P/E to 20. Given expansions (when announced), that P/E could be justifiably much higher.

The only downside is the continual rise in freight charges. Some commentators suggesting there will be no respite for another year, as post pandemic world trade maxes out.





With the cash inflow demonstrated this quarter, I expect financing justified for POSCO JV and Pilgan Stage 2. This quarter's profit attributed to the current Ngungaju plant upgrade.

Drilling results due and a POSCO JV announcement also.