People often try and rationalise the current share price by...

People often try and rationalise the current share price by saying "the market thinks this" when they really have no idea what the market thinks and what the driving force of the SP is. People that make these types of assertions have usually not done any analysis to prove or disprove these assertions, so they are really just wild arse guesses. People often just assume that "the market" thinks about the stock in the same way they do. More often than not it is the commodity price and general market sentiment which is the driving force (i.e. 80-95% of the price action). Sure the share price may be more resilient than other lithium stocks as people expect positive news regarding funding and then tank when they get hit with a CR instead, but this may reflect a reversion to the mean more than you think.

For example, this chart compares the GT1 price action since the start of the calendar year to Galan (Galan is in blue). The price action is almost identical with both dropping around 50% since the start of the year.


This is GL1. Again, the price action is very similar with perhaps Galan holding up better with the potential for positive news regarding funding, until it reverted to the market trajectory after the CR:


This is WR1 which also dropped 50% since the start of the year but has since recovered from the 6th of February, whereas we have had the CR shares issued on that date and experienced a massive amount of selling from Macquarie (or a client of Macquarie) which started on the 6th of January.


LRS has a similar pattern to WR1 (i.e. a recovery since the bottom on the 6th of February) again which happens to be the same date the CR shares were issued and the date the Macquarie client starting dumping.


Arcadium has shown a similar pattern though being more diversified and in production it is not exposed to such dramatic swings (then pendulum doesn't swing quite as far) but the point is the price action is surprisingly similar:

So no the market is probably not panicking about funding as much as you are attempting to make out. The market has trouble digesting CRs at the best of times let alone in a down trending market, let alone when the market is hitting [what may well be] a capitulation low (on the 6th of February) across the entire sector.

We'd probably have to ask the Macquarie client why they are panic selling now as they have been the main driver since the 6th of February (which may have prevented Galan from experiencing the rebound we have seen in some others). It could be as simple as Galan falling outside of the market cap or liquidity requirements, or that they are wrong footed elsewhere in the market.

If the market is so worried about funding why is it that Lake has rebound since the 6th of Feb when they have a much bigger funding problem? And no they don't have an infinite amount of time because they haven't started construction, they have less than 1 quarter of cash available and burn at a faster rate than Galan in full ball construction (twice as fast actually).

UPDATE: Just saw that shiok has just covered the same concept... I'll post this anyway as it provides a little more detail.