How did you get 78c? The base case is A$410m so half for TAW and...

First 68 Last

Share
Profile

Follow
Hklim6

40 Posts.

1

02/11/17

18:00

Post #: 28449027
Share
How did you get 78c? The base case is A$410m so half for TAW and divided by 456m shares is 45c. Still more than the downrampers suggest though.

Originally posted by ptan ↑

Tawana is still a compelling buy after the recent surge. Based on current projections on Baldhill by Canaccord, we have these astounding investing metrics -

Current (conservative) base case NPV is at 78c per share

Free Cash Flow (FCF) yield on current price is an astounding 24%

IRR of 185%, payback within 12 months

For investors, just focus on these risks. Operating risk is well mitigated - quality of management, lithium off-take agreement, production plans on schedule and project feasibility. Financial risk appears to be fully mitigated too based on Canaccord’s financial projections and that project funding is fully secured.

So this makes a simple case to invest (or to add further) in Tawana at current SP.

I have mentioned on number of instances that I intend to hold Tawana at least for the medium term (3 years). This time-frame will allow for the full earnings flow of Baldhill. If feasible, during this period, the company can also fast start the Cowan project (this is a huge hidden value for Tawana shareholders).

However, there is one risk that I am wary about, i.e. the state of lithium industry. This is a macro industry risk (that leads to boom, bust situation) – that is beyond our control and has to be closely monitored.

I find it amusing for stake-holders frequently lamenting about the current SP (not reflecting the true value of Baldhill) and getting rather impatient. It is a case of perception against reality; traders against value investors. If you believe in Baldhill project, then stay the course. From my experience, value investors will always trump on a longer term basis. Patience is the key.

I quote a popular investing adage “investing requires you to look at the season, not the weather”. Remember this line.

Expand
TAW Price at posting: 34.0¢ Sentiment: Hold Disclosure: Held
1 Upvote

0 Great analysis

Reply

Top Stories

MLS

Metals Australia kicking off plant study at Lac Carheil; Canadian tariff tailwind potential

VUL

Vulcan appoints investment bank and M&A veteran to board

NAM

Olam Agri raises Namoi takeover offer to 75 cents a share and receives shareholder backing

Dale Gillham's weekly wrap: US fracking support boosts outlook for Australian gas stocks

MKG

Mako sniffs gold at 170 g/t at Cote d’Ivoire's Napié play

ASN

Utah authorities sign off on Anson's lithium extraction plans at Green River

AZY

Antipa divests its Citadel interest to JV partner Rio for A$17M, refocuses on Minyari Dome

Week 37 Wrap: HotCopper likes Cuban oil; markets shrug debate off for Putin; firebrand quant says social media a market threat

ENV

Enova Mining unveils "high-grade" REE drill hits at Coda North, Brazil

MM8

Medallion Metals kicking off 15,000m drill run at Ravensthorpe gold play

There are more pages in this discussion • 55 more messages in this thread...

First 68 Last

Add TAW (ASX) to my watchlist

How did you get 78c? The base case is A$410m so half for TAW and...

Top Stories

Metals Australia kicking off plant study at Lac Carheil; Canadian tariff tailwind potential

Vulcan appoints investment bank and M&A veteran to board

Olam Agri raises Namoi takeover offer to 75 cents a share and receives shareholder backing

Dale Gillham's weekly wrap: US fracking support boosts outlook for Australian gas stocks

Mako sniffs gold at 170 g/t at Cote d’Ivoire's Napié play

Utah authorities sign off on Anson's lithium extraction plans at Green River

Antipa divests its Citadel interest to JV partner Rio for A$17M, refocuses on Minyari Dome

Week 37 Wrap: HotCopper likes Cuban oil; markets shrug debate off for Putin; firebrand quant says social media a market threat

Enova Mining unveils "high-grade" REE drill hits at Coda North, Brazil

Medallion Metals kicking off 15,000m drill run at Ravensthorpe gold play

Featured News