Ann: Pilbara Minerals to acquire Latin Resources, page-157

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15/08/24

20:11

Post #: 75227652
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Originally posted by pastperformer: ↑

Had a listen to the call. Few thoughts.

1. Analysts were concerned about the actual deposit

Hilarious, some of these analysts have studied geology for maybe 3 years and never worked in actual mine before. Some of them probably studied law and finance and did a 6 month course with an investment bank on metals,mining and materials. Yet they have the nerve to question the worlds best hard rock miner on whether they know anything about a hard rock deposit? If it wasn't so ridiculous you would be excused or thinking it was a G up.

2. Not earnings accretive.

Well duh, it's an explorer which requires cap x spend. To add to that, every analyst on the street now has the most bearish pricing deck for lithium, combined with cost inflation for projects so that everything looks like it's a negative NPV project.

3. Timing

I mean this is the most ridiculous take on the whole thing. You have Investment banks who got paid over $300mil for the Livent and Allkem tie up because of "sygnergies" at the very top of the market. Patting themselves on the back because their forecats had LT lithium prices 3x higher than the cost curve. Yet now, we have a counter cyclical acquistion and these geniuses think it's bad timing and provides no synergies?

The whole thing is laughable in my view.

You either 1. Believe the long term spot price has moved structurally lower so literally every deal looks like value destruction.

or 2. Believe the long term price will go higher in which case using their scrip to add another possible 100mt+ in a strategic location is pure genius.

Seems like everyone is in camp 1, which makes me even more bullish. Clearly no investment banks got a big lick of this deal.

Expand

"It seems you've ignored past performance."

A year ago, many so-called 'smart' investors dismissed the UBS analyst's bearish lithium call when PLS was trading at $4-$5. Look at it now.

Before critiquing finance and law graduates analyst, perhaps you should consider learning from past performance "

PLS Price at posting: $2.74 Sentiment: None Disclosure: Not Held
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