Just reviewing numbers on $moly Greenland Resources with a $32/lb molybdenum
80% pretax IRR
67% post tax IRR
NPV @5 ~$4 bln
NPV @10 ~$2.5 bln
*assume 60/40 debt equity
Vs $85 mln market cap
When this fucker gets it’s permits is gonna go bonkers. 10-20x
80% pretax IRR
67% post tax IRR
NPV @5 ~$4 bln
NPV @10 ~$2.5 bln
*assume 60/40 debt equity
Vs $85 mln market cap
When this fucker gets it’s permits is gonna go bonkers. 10-20x
Numbers are ridiculous and it’s gonna be taken over quickly imho. It’s too big and strategic a project. Big steel company is gonna snag it. FFS
Best #molybdenum play around. One of the only pure plays moly companies of merit and it was permitted last cycle… getting close to completing its repermitting.
I loaded up on millions of shares cause this is exactly the type of stock that has delivered for me in the past
I loaded up on millions of shares cause this is exactly the type of stock that has delivered for me in the past
Oh. And molybdenum will be +$40/lb so you can crank up the npv higher as the permits roll in. Gonna be nuts
As a major shareholder I hope to see management continue to focus on permits, engineering optimization, long term off take agreements coupled with customer supported low interest debt financing
I always prefer to just see minimal equity dilution while advancing the asset so that is served up on a platter to a major to take over. Would be good to get a couple institutional investors on board to help support the stock
Similarly to the huge win we had selling PBS coal to Severstal… behind the scenes we invited 5 different global steel manufacturers to complete for the take over. Set up a data room and get as many of the big boys in it as possible. This cycle because of EV markets…
I believe some car companies will be looking to invest in strategic material companies. The European steel and auto industry is currently completely reliant on foreign moly sources. China is a huge player and everyone else should be very concerned.
China will likely go from being a net exporter of moly to an net importer. The shock to the nonchinese moly buying community will be drastic if/when that happens. Don’t be surprised if moly spikes to $80/lb
Historically when a commodity makes a new decade high it typically doubles very quickly. As we look to run to the old all time highs in molybdenum I can’t help but wonder where it will squeeze to this cycle
It must be understood. We are not making high quality like steel for high tech industries with out molybdenum. We aren’t doing deep horizontal drilling for oil and gas with out molybdenum and we aren’t building new pipelines and gas plants with out molybdenum
So.. as I sit and dream… if moly goes to $40/lb this year from current $32/lb (which is highly likely. And permits are simply renewed (no reason why they won’t) then this stock should run hard gain institutional support and….
Amazingly… even if we target a goal of a $10/sh take out or ~$1 bln for someone to take the company and run. That would only be 1/3 of the npv 10 using $40/lb. still cheap as fuck and a no brainer for a steel co. An auto co or more BHP, Vale, RIO, Chinese conglomerate, etc
They say $6 cash cost. Even with huge inflation call it $10 and $20-30/lb free cashflow between $30-40/lb moly. Times 30mln lbs a year. Is $600-800mln of cashflow. It’s a fucking steal at $10/sh…
As I rant about this on twitter and churn the basic numbers in my head, I’m reminded of back in my Sprott days when I would see Eric go through this same exercise in the morning meeting then declare… well I guess we know what we got to do today…
And we would proceed to go to 19.9% of the little shitco resource company that no one gives a shit about. Why don’t they care? Cause the street is both busy and lazy. Barely anyone pays an analyst to cover the moly sector. It makes the uranium sector look huge.
There just so little investment banking business or trading commissions to be had that they don’t care. They will all line up and try to get the last bit of business. The final raises and the consulting fees on the take over / sale. But other than that it’s a PA stock
And barely anyone has time to focus in and look at the odds of success to repermit. And the huge economics. And strategic importance. Someone like @hkuppy would spend the time to look. But odd balls like him are rare :) anyhow. Feeling like I got a real winner here and
A few wins like this make all the difference.. they erase past sins and create hero’s. if anyone disagrees with the math… please let me know. Cause it’s back of the envelope stuff. Generally speaking stocks I invest in don’t require complex financial models.
I discovered early in my resource investing career that if you can’t do the math in your head and clearly see it’s got massive upside potential then it not worth my time to do a detailed model. And I further learned the detailed model typically is irrelevant once done
Cause right now I don’t care if the npv 10 is $2 or 2.5 or $3bln. Cause the market cap is under $100mln and I know it’s gonna get taken out at some point when enough shareholders are satisfied with the win. If it goes fast my bet is $5-6/sh. But…
With good institutional support and strong handed like minded investors. We can take this think to $5-6 and get it taken out for $1bln or ~$10/sh. Just like PBS Coal
I so love stocks that get me excited…
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