So what if you have no degree in Finance/Economics, once you learn how to model properly and value a stock, you have the tools you need and can hyper-specialise on being awesome at it. Pieces of paper are overrated, you'll learn more about business from reading all the Berkshire Hathaway letters than attending many Australian universities to study business (not finance though). You have the passion, that's 90% of the game. Passion will drive you to master a textbook with all its minutiae, passion will drive you to build the "perfect" model.
I have a business degree and the previously mentioned postgraduate activities but I come from the working class via the military, I've lived on both sides of the fence; having no piece of paper and now having a few. Now let me emphasise this: if you don't need the pieces of paper for a passport into the job you want, the resources I listed in the previous link have the potential to make you an awesome investor when they're combined with passion and hard work. Don't limit yourself that you can't do x or y because you don't have a piece of paper.
On Syrah:
The valuation range is so large from analysts ($2.90-$7.45) because you can get to either valuation quite easily depending on your choice of: graphite prices, opex, actual spherical output and timing of expansion, the date when vanadium processing occurs, when expansion occurs at Balama for more graphite/vanadium, the weighted average cost of capital which I use as the discount rate, and, notably whether you decide to use a normalised country risk premium or one based on current circumstances.
A key point though, is that you are valuing cash flows over the next 47+ years and for investors short-term blips are minor as long as you have a revolver in place to cover working capital needs.
You don't ignore sovereign risk, you incorporate a proper country risk premium into the discount rate and see where that leads. Is your company undervalued or not with the appropriate discount rate. Don't ignore alternative futures with the ramp-up but do a proper sensitivity analysis for them.
When I build simple models for Kibaran, Syrah can kill them if management ever elects to do so. I wasn't comfortable with this but evidently your risk tolerance is much higher than mine. When I build complex models for Syrah with my assumptions of how the future plays out, the company is undervalued. And, Syrah is pretty robust, if there was a spike in the discount rate to 19.35% (Cannacord uses 12%, Macquarie uses 12% for Balama and 15% for the BAM operations), I still value the equity at AUD$4.62 implying 40% theoretical price appreciation in addition to the annual 19.35% return.
Many of my recent posts on KNL have been highlighting what I see as problems there. The post-tax NPV in the recent BFS is low and even lower when an appropriate discount rate is added. You're shooting yourself in the foot by not understanding this because many other market participants do. I get quite annoyed coming over to KNL and being called a "farquit" for trying to open you eyes to things I wish I'd know earlier.
It's such a shame that we can't use HotCopper to work as a team and have constructive debates. Oh well. I hope you change your mind mate. Don't waste your passion.
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