GMP initiates coverage on Trevali with a 12-monthGMP initiates coverage on Trevali with a 12-month target of $2.20. They believe that Trevali will be a likely takeover candidate in the Zinc space. If the $2.20 target seems low it may have to do with the 40% dilution with recent financing.
In the meantime another Zinc company bites the dust. Trafigura agrees to buy Iberian for $1.10 per share. Several analysts are wondering today if Trevali is the next one to go.
Nyrstar is sitting on over $500 million in cash looking for more Zinc acquisitions. With Trafigura and Nyrstar buying all the Zinc producers out there, you have to wonder what Trevali’s partners Glencore and Xstrata are thinking.
Finally GMP are putting their money where their mouth is by buying 127,000 shares of Trevali in the open market today and they have over 40,000 on the bid.
This is exactly what they did to ITH a couple of years ago. They started coverage then bought the stock up to over $10 per share (not that Trevali is heading anywhere near that price but it’s certainly good for a triple at least) by buying millions of shares in the open market. We have seen this movie before and last time in was Oscar worthy.