Cycle Bottom Profile picture
Mar 5, 2023 15 tweets 3 min read Read on X
Thought of the day: Return compounding is all about timeframes in #cyclicals, 10x over 5 years reinvested in 10x over 5 years reinvested in 10x over 5 years with 1-2 year waiting between reinvestment = 1000x over 17-19 years. Are you formulating your compounding plan?
Our working example:

$BTU from $1.21 = 13x < 30 months

deployed into:

$IREN from $1.32 = expect 10x over 48 months

deployed into:

Unknown at this time = 8x

Total return = >1000x
Documented is previous tweets
Why $BTU it was -98%, with a reasonable probability of a debt restructuring, coupled with quarterly cashflow that could move from $20m to $500m = 30x re-rate

Why $IREN is was down -96%, reasonable survivability runway, cashflow ability at $50k #Bitcoin would equate to >5x entry
@GjStocks An example: $WKT

At 10c it's 5-8x returner over 5yrs

At 5c it's 10-16x returner over 5yrs

So the lower the sp goes with unchanged core assumptions, the higher the return.

The vision required includes - successful project implementation and scalable production over 5yrs.
@Pedro82854342 What's falling to 15-20yr lows?

#preciousmetalstocks ??

If #lumber falls below $300, what opportunities will be available?
@GjStocks Why 99% won't be able to compound a portion of their portfolio at 1000x over 19 years?
- average holding period is 3 months compared with the 5yrs plus required
- very few have the emotional position to buy on -97% sales
- the perceived low risk near cycle tops
@SemiGodDevil The key for what comes out of the oven is 80% based on spot price for #cyclicals

#Bitcoin next cycle peak? US$75k-175K

#Uranium $95/lb average for the peak year? $AEE $FSY $WSTRF $EU

Expandable #graphite > $2000 basket price? $WKT

#Metcoal next peak year 2027> $400/t $CKA
Turning $20k into $20mil over 20 years is the objective:

1st asymmetric trade 20k becomes $220k

2nd asymmetric trade 220k becomes $2.4m

3rd asymmetric trade $2.4m becomes > $20m
How to pick your 1st asymmetric trade? #cyclical

1st -96-98% is fertile ground (market cycle bottoms offer)

2nd Mean reversion given cashflow reversion, look for where spot prices can 3-5x from lows

3rd Safer ground is where the sector behaviour is consistent over cycles
One niche example: based on #gold spot +50%, #silver +100%

#preciousmetalstocks

Nano caps <$20m with compelling possibilities at >$2500 spot

$GPR was a recent one 1-1.7c accummulation range

$WWI at 0.5-0.9c is on our watchlist @ $2500 spot project IRR> 70% & NPV>30x cap
@Peak_Ascent We would add that burning match #preciousmetal explorers are tricky beasts, they are not our preferred focus generally speaking. Too many are lifestyle cash burners for the CEO. Several are approaching extremely low historic valuations, so it would be remiss if we didn't zoom in
@deruyter1667 $IREN would have struggled to go bankrupt in the worst sector conditions, ie. if Bitcoin went to 8k.

At $1 was trading at 0.3x 2024/25 CF

Implied > 20x upside
Note how $IREN trades over the next 18 months as #Bitcoin achieves:

35k = $4.50-5.50 +4x return

70k = $14-16 +15x return

105k = $22-28 >21x return
#Energy is on the move.... Image

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More from @BULLReturns

Apr 1
Pre-production #uranium cap performance from 1Q 2025 lows

$AEE +65%
$GLO +69%
$FSY +92%
$LAM +70%
$GXU +116%

On this basket we expect 3-4x returns (from 1Q 2025 lows) for this #uranium upleg through 2026
Compare with #uranium large caps:

$CCJ +3%
$NXE -3%
$PDN -18%
$KAP -7%
$DNN 0%
$UEC +1%

This overvalued basket we expect +1x returns in the upleg through 2026

The pre-production set is trading at a 89% disc, this will close to 35% as they aspire to production or are acquired
Must add ofcourse $WUC +51%
Read 5 tweets
Mar 4
Our #uranium top scale in bids are within 5% of being hit
< 1.5x 2028/29 CF (near fully diluted) we are scaling in for the next upleg #uranium

Stocks that are converging on this with further 10-25% falls are:

The Western Aust ban view: $TOE $CXU

The African view: $AEE $GXU $FSY

The US view: $WUC $EU $LAM $AEC
We will add $PEN to the US view post another 25% drop
Read 5 tweets
Jan 12
Not a 2025 impact, perhaps 2032-2035 #uranium Lets understand 2025 impacts to avoid misunderstandings on timing.
2025 #Uranium is about service bottlenecks (sticker shock to Utes) + Russian supply cuts to the US + unexpected supply cuts (KAP pivot to East + negative events)

2H 2025 several US Utes will likely require action on replacement supply sources = Spot buying (8-12lbs)
New data centres requiring speed of implementation will look for the quickest solutions likely gas powered module products avoiding long interactions with slow moving bureaucracy.
Read 6 tweets
Dec 30, 2024
What's a US$5m pre-production cap #gold #silver play with 2 mine $200m NPV (@ 2700 gold) worth as the following occurs in 2025?

PFS release on 1st mine in January 2025

1st mine offtake financing of $28m or strategic partner financing?

Dilution over 2025 likely to be $2m
Potential outcomes as #gold spot climbs through $3k:

A) no project funding and $2m dilution at cap lows (25% probability)

B) project funding secured & +200-400% rerate (50% prob)

C) dilutive project funding secured at the cost of 50% project stake reduction (25% prob)
Plus #copper play
Read 4 tweets
Nov 11, 2024
As our followers will recall, we used $GBTC at its 50% disc near cycle lows to achieve our #bitcoin exposure, our scale down for this cycle commences at $84k through $135k over the next 12 months. This will equate to >10x returns from GBTC over a 3 yr holding period from 4Q 2022.
The cycle continues to dictate our 10 bagger position, as it should do for our followers.
This will also complete a full exit from our #bitcoin miners, that were not fully scaled out at earlier 2024 peaks
Read 5 tweets
Nov 1, 2024
Pre-production micro cap #Commodity stocks rules to adhere to:

A) drill program to scoping study

Dilution funding (up cycle): 30%
Elapsed Time: 18-24 months

B) SS to Pre-feasibility

Dilution: 60%
Elapsed: 18-24m

C) Pre-feasibility to DFS/BFS

Dilution: 80%
Elapsed: 12-18m
D) DFS to production (compelling project)

Dilution (cumulative) 90% plus
Elapsed Time: 30-48 months

Total elapsed: 76 to 114 months

For a downcycle one can double the dilution.
<3% of projects are compelling
=

Scalable resource

IRRs > 50%

Location has existing infrastructure

Low on the cost curve

Capex intensity mild

Can move into production this cycle

Won't dilute shareholders down to near zero
Read 4 tweets

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