Mate, if you hope for PLS to turn into a $20 share in 2 or 3 years, then you need to work backwards from your $20 hopium valuation and see what price spodumene will need to trade at to give you that valuation and also guess what PE the market willbe prepared to pay. Going on past performance at peak spodumene valuations, PLS got to a market cap of about $17.5bn when it was selling spodumene at auction for over USD8000/t.
At $20 the market cap would be about $60bn.
Production will be about 1.5x in 2025 what it was end of 2022 with the P1000 expansion.
A simple calculation then we can calculate the required spodumene price:
Given the high profit margins costs other than productions costs are negligible(though, this provide a low value for the required spodumene price, but it is just a ballpark number)
So then:
$60bn market cap / 1.5 times the production / $17.5bn market cap x USD8000/t spodumene price =
USD18285/t.
This is just a ballpark number(probably better than a wild guess), but implies a spodumene price of around USD18 285 to give PLS a market cap of $60bn (equal to $20 per share).
You can make up your mind on how realistic it would be to expect the spodumene price to get to USD18285 in 2 or 3 years from now. It would have to rise about 10x from where it is now.
You decide if you think that is realistic.
Good News & Bad News, page-35596
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Last
$2.89 |
Change
-0.100(3.34%) |
Mkt cap ! $8.699B | |||
| Open | High | Low | Value | Volume |
| $2.95 | $2.97 | $2.89 | $45.17M | 15.51M |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 28 | 335341 | $2.89 |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| $2.90 | 154500 | 2 |
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| Last trade - 16.10pm 22/07/2024 (20 minute delay) ? |
| PLS (ASX) Chart |