The value of the mine is based on the IRR attributable to the mine. That is production over time at a given REE price and capex/opex costs associated with that development. When you develop a mine you must meet your hurdle rate of return. You can't just take the resource and multiply it by price to come to a value. The value of the mine is the profit to attribute from the mine going forward. I hear the comment about the other producer - same same, the market is giving it a value because the discounted cash flow of that mine when operational is assumed by investors to meet the hurdle rate of return. In a nutshell without profit the mine is worth nothing, and by profit I mean future projections of profit. So LYC is trending up because the market is saying that its profit over time is expected to grow. I don't know what else to say, but that is how stockbrokers etc value a mines worth (including in any takeover battle). It is no pint looking at one side of the equation without the other - if I ever get around to it I might do my own discounted cash flow model (an IRR model) but with three year old twins finding it hard to model anything yet.
LYC Price at posting:
11.0¢ Sentiment: Hold Disclosure: Held
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