I would be careful of who you are collaborating with around trying to find a value for the businesses of MHM. Re read some of the warning posts re Firsova - very noob.
You are ballpark in the numbers you have thrown around with the Australian Ops but you have only considered 25,000t of salt slag processing which is the tolling.
What about the following revenue items?
1. Alcoa NMP 2. Landfill Salt 3. Landfill NMP 4. Sims Salt 5. Sims NMP
Sims and Alcoa tolling only represent 50% of the revenue or thereabouts so you can pretty much double the value fo the Australian OPS.
Before the naysayers have a hissy this is only assuming the on sale of the treated NMP of $150-200 per tonne.
So far your analysis is good but way way short of the entire op.
On the discount - use whatever you feel as comfortable for the US but contracts in place in AUS and 20% is very high.
On an NPV basis for the Aussie ops only using a 10% discount rate and all of the above (60% of profits attributed to MHM) is around 65c
Add say 25c for Silica Opportunity and 50c for a blue sky rollout with revenues estimated to start at 30m pa in the US within 2 years and this is the reason the stock continues to find support. When you are dealing with an industry gamechanger they always trade at a premium.
This has bags left on a medium to long term basis
Good luck with the rest of your work
MHM Price at posting:
$1.19 Sentiment: LT Buy Disclosure: Held
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