Lebed updateI got this today:
Rare Earth Metals Inc (TSX Venture: RA) has the potential to EXPLODE this week to the upside from its current price of
.465! RA broke out and gained 22% Friday afternoon on record volume of 4,769,092 and only has a market cap at
.465 of $37.7 million when they have $7.3 million in cash and no debt!
RA's closest comparisons Avalon Rare Metals (AVL) and Rare Element Resources (REE), currently have market caps of $690 million and $480 million respectively.
AVL was at RA's current price of
.465 back in March of 2009. AVL exploded to hit a high in September of 2009 of $3.99. AVL bottomed out in May of 2010 at $1.09, but then exploded to a high last month of $8.20!
AVL recently gained 652% in just eight months! AVL made a total gain of 1,663% from the time it was RA's price of
.465 in March of 2009!
REE was at RA's current price of
.465 back in April of 2009. REE exploded to hit a high in October of 2009 of $4.34. REE bottomed out in July of 2010 at $1.15, but then exploded to a high last month of $17.92!
REE recently gained 1,458% in just six months! REE made a total gain of 3,754% from the time it was RA's price of
.465 in April of 2009!
Even if we go by RA's low in July of 2010 of
.14, if RA made a total short-term gain of between 652% and 1,458% from its low just like AVL and REE did, RA could explode in the upcoming weeks to a price of between $1.05 and $2.18 per share. If we go by the conservative number of $1.05, that is still 126% higher than RA's current share price of
.465!
Back in March/April of 2009 when AVL and REE were trading for RA's current price of
.465, RA in those months traded between a range of
.18 and
.27. If RA makes a total long-term gain of between 1,663% and 3,754% from RA's low in March of 2009 of
.18, RA could reach a high in the years ahead of between $3.17 and $6.93 per share. If we go by the conservative number of $3.17, that is still 582% higher than RA's current share price of
.465!
So based on the recent short-term explosion in AVL and REE from their lows, as well as their long-term percentage gains since they were trading at RA's current price, RA could see $1.05 to $2.18 in the short-term and $3.17 to $6.93 in the long-term!
It is unbelievable to me that RA is currently only
.465! RA's drilling equipment for their 2000 meter diamond drilling program at the Clay-Howells project will be arriving any day now! This might be the short-term catalyst RA needs to make a break out similar in size to AVL and REE!
AVL and REE are closer to production than RA, but when companies in this industry reach production they usually start to become worth many billions of dollars!
Molycorp (MCP) had its IPO last year at $14 per share and surged 349% to a high six months later of $62.80! MCP currently has a market cap of $3.93 billion, with revenues of only $15.38 million! MCP is trading for an unbelievable 274 times sales!
There is nothing hotter on Wall Street right now than rare earth metals due to China cutting exports to the U.S. There is HUGE unmet demand for production of rare earth metals outside of China and until this demand is met, I expect this industry to remain on fire!
AVL, REE, and MCP already made extremely large gains and their upside potential might be somewhat limited at their current levels. In my opinion, investors in AVL, REE, and MCP could start diversifying out of those stocks and into RA in the weeks ahead! I have given RA a speculative rating of 1, my HIGHEST level of confidence! RA also trades in the U.S. under the symbol RAREF.
I am NOT making any target prices for RA and in no way do I recommend that you buy this stock. All rare earth metals stocks are extremely risky and speculative. RA could crash to zero and you could lose all of your money if you choose to invest into this stock. Never make investment decisions based on anything I say and never invest what you can't afford to lose!
Just so that you don't blame me if you make a large bet on RA and lose, I actually will make a target price for RA, my target price is
! Let me repeat, my target price for RA is ZERO!
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Jonathan Lebed
Lebed.biz
Staff