Darkstone,
I wouldn't bet on a turn down now. The big boys (and girls) have had a chance to digest the merger details and it is clear that a number of fund managers will need to do some rebalancing - especially the international funds. There is a clear distinction in base valuations between the 2 x Chinese, 1 x US and 1 x Chilean industry leaders and the rest of the lithium players - with MergeCo valued completely differently to the aforementioned stocks.
We will start to see big chunky purchases (and in some cases sales) of both ORE & GXY in coming months. At some stage, the investors will need to start accounting for the synergistic benefits of the merger (Citi put it at between 5 - 12%) on top of the equalisation (of MergeCo relative to its industry peers) and then the benefits of a rising lithium price.
There's going to be impacts that cannot be measured by past price performance. This is where the key share price changes will come from.
GXY Price at posting:
$3.64 Sentiment: None Disclosure: Held
