Hmmm, in this thread a lot of things mentioned……………..
GG: Back to where we started and very disappointing yearSP. At this point I agree wholeheartedly. However, this could not be said April to June. At that point it was doing better than practically any lithium stock except KDR. IMO, this was driven by sentiment that it was a good play in the USA given the interest in critical minerals and even the US Congress. It did well for those three months and I should have taken some off the top but, no, I was a fool. Oh well. Then in July, the market took over (trade war, China subsidies, lack of China conversion and SC6 oversupply, etc.) and grabbed it by the neck and shook it hard causing it to fall in line with the rest of the crowd – (what gives you the right to be a high flier, get back in step boy!) - maybe even worse but not by its own doing. The upgraded SS in August was great with a huge NPV, but by this time sentiment was too bad. Back in June or so someone in this forum suggested that it was overvalued and they would jump in when this drops to 9+/-. I thought yeah right, that won’t happen. It did. He was right. At the bottom now? . How low will it get? At this point hate to say, but IMO I agree with that guy that this is a good entry point. Will it get to 6 datawz? Hmm, maybe, hope not, but if it does I say get in.
dawatz: fallspecific to PLL or to the market and fundamentals….. IMO, as mentioned, the fall is not specific to this stock. It is market sentiment. But, maybe not totally. Things have been quiet in September with PLL. No news announced. We like news and when we do not hear any people get nervous. Maybe there is a problem. Presentation told us to expect near term catalysts: 1) Permitting and 2) offtake discussions going forward. Quiet so far and until we hear something on these IMO, it will hover around here for a while. If we do hear something on these fronts, then IMO we will see some improvement. B808 suggested Fed permits will give it momentum. Hope so if they get them. They say they are on track so let’s see. They have hit everything else. Fundamentals are still there for PLL and for the market. Timing is out now as you say. Also, do your own checking on this: IMO the Li market tracks with Tesla, the EV market leader. Put in TSLA and any of the major Li chemical producers in your stock comparison (LTHM, ALB, SQM, Tianqi, Ganfeng, ORE). They track right along with TSLA. As goes Tesla, so goes the Li market. Of course, many factors affect Tesla. Anyway, all the big producers are optimistic about the market. Big car manufacturers are investing billions, etc. Well, let’s see.
GG: Downside risk.Shizenhausen!!!Downside: EV market does not improve and catalysts are not hit. This does appear to be a premium project given location, management, etc. The market saw its value as a premium project earlier in the year and if they hit these near-term catalysts then it should be good. Some analysts are saying early 2020 for improvements to the Li market. With catalysts and market improvements it should be good but delayed gratification.
Refer to this recent article about timing – early to mid-2020:
https://www.reuters.com/article/us-australia-mining-batteries/australian-lithium-recovery-seen-by-mid-2020-as-ev-production-revs-up-idUSKBN1W304G
Hooper was mentioned. I do not remember anyone here posting the latest Hooper report on PLL, so I will post here:
https://docs.wixstatic.com/ugd/affbaa_3a5ec1fdf1274941800735627f7d88f8.pdf
Good report based on the updated August SS. He is high on PLL, but quite a bit more conservative in his analysis than the PLL SS. Some things I agree with and some not. He used a LT LiOH price of $13,000/t and PLL used a price $16,500 beginning in 2033. This is the big difference. Maybe it is somewhere in between, who knows? PLL is aggressive in the price. Hooper says LiOH production to begin in 2024. That is a longer timeline than PLL. I hope it is sooner than that and if the market improves maybe they can be more aggressive and start producing sooner. Hoop says 2 years to get OEM approval for product. Seems long to me. Simon Moores with Benchmark recently posted a timeline for this of 6 months. Somewhere in between? Hoop has higher operating costs and not sure of his justification for this. I think he is off here. He has lower recovery and this is based on the history of other producers. Perhaps. Given all of this, he has arrived at a much lower NPV: $784M vs. PLL $1,447. That is 46% less. IMO, that is too conservative and it will fall in between. Nevertheless, he has a LT SP of .66 to .77 AUD over 6 years and this is based on an EV/EBITDA of 8.5 to 9. If you use this metric with the PLL SS EBITDA of $300 MM, then you get a LT SP of 1.27 to 1.34 USD (1.88 to 1.98 AUD). [$300M x 8.5/2009 = 1.27USD] (2009 being 2 billion shares estimated by Hoop- see pages 28 and 29 of report). So, another way to look at this is LT SP between .66 and 1.98 AUD. Great potential here but only if they deliver and market changes. It will. When? 2020??????? How fast up to production? Maybe Livent or Albemarle jumps in! Either one of these are logical as Hooper points out.
Summary:
· Interest in the best strategically located critical mineral hard rock lithium asset in the US is there.
· Market sentiment is not.
· If Tesla improves (EV sales improve), Li majors will follow as will juniors
· If PLL delivers on catalysts, interest in PLL will strengthen
· Per experts, market to improve in possibly early 2020
· Great LT SP potential
· Potential of synergistic acquisition or partnership by neighbors LTHM or ALB
· A lot of ifs
So much for this gibberish on the matter which means absolutely nothing. GLTA
(20min delay)
