$2.03 by Xmas, page-2

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Trommel

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13/11/16

13:34

Post #: 20579135
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Originally posted by Riskon22 ↑

$2.03 by December is very realistic, but what would have to happen for this to occur?

Firstly, imo the graphite sector is yet to receive a credible off-take. By this I mean one that is not Chinese or with a trader.

The Li sector was dead until Tesla signed it's 2 off-takes in sept/oct 2015. For those who then held a company that even mentioned they might have Li on a tenement, the rest is history. Anyway, when those credible off-takes were announced, the SP of both company's roughly doubled the same day although then pulled back around 20% over the next 1-2 months before heading upward again.

Based on the Li sector experience, if Magnis announced a western household name off-take i.e. the sectors first credible off-take, our SP could very well double on that day. Lets say our SP creeps up to 70c over the next 1-2 weeks, and then the announcement we have all been waiting for occurs - $1.40 would be the expectation.

But then, what will keep us climbing to $2.03 rather then sellers taking over. IMO:

- MNS is targeting conservatively $1.5k/ton profit whereas Li (spodumene) producers are looking at roughly $400/ton profit. Planned annual output isn't much different (based on the typical Li 2mt ore throughput scenario). As has been said before, there's a lot more profit in a G player like Magnis that what any of the Li producers are looking at.
- after the first off-take, the flood gates could open as all the big names have to lock in supply before others do
- RAP should soon be finished and be a positive announcement
- finance is already well advanced
- management are already prepared to begin construction in April 2017
- most importantly, a western off-take validates the Magnis business model. A model that is so lucrative it is currently disbelieved by many i.e. to good to be true

When, it's realised that Magnis is the real deal and going into production, IMO there will only be one place for a growing number of G investors to place their money behind.

Therefore, based on the Li sector comparison and the expectation of a credible off-take that will validate the Magnis business model on a project that is shovel ready, $2.03 by xmass seems very realistic.

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Couldn't agree more Riskon22!

Glad to see you followed the new site wide HotCopper rules by providing reasons and facts in your post. (Not that you don't normally of course)

MNS Price at posting: 61.0¢ Sentiment: Buy Disclosure: Held
10 Upvote

0 Great analysis

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