resource update / PEA / separation/ investmentI have been very critic of the management in the past year and I am still not happy with them for the messy year, lack of vision, missed deadlines, etc. I think there is a "management factor" tht reduces the share price. GMA promesed a lot and did not deliver. Investors jumped on every chances they get to sell and run away.
The last 2 news releases are encouraging. Things are at least moving and it seems to be in the right direction. We are more than a year late, but the management did released 2 news and undertook to release the resource update in June, so we have a bit more clarity and transparency. That's better.
What will get GMA moving?
I will try to guess what will get GMA moving (and I guess I will also be wrong on all counts, as everybody else in the last year :)
Resource update. We have one resource update published in 2011. DDeadlock put it back to light with a number of 82 billions. We all know it and this number is huge. What 120 billions will mean for the share price? 174 or 209 billions? the truth is, even though it should be well perceived, I do not think that il will get us moving that much... We may have hints of what is coming with the PEA, but I do not think it will move that much. Or else, it will move up or few days and get back down after.
PEA: How many pages of technical data do you think we will have to digest? OPEX and CAPEX will probably be good, but who will really understand the real value of the company? What is the percentage of investors who understood the last metallurgy press release? It was a one pager. Think about this 43-101 report with hundreds of pages of data...In the last years, which REE company published a PEA and had a huge increase in the share price? How many frustrated investors will sell on news? What if the OPEX is not 1 billion, but 600 millions, will GMA go to a buck? Again, I think it may increase, but my prediction is that it will not go as high as we all want.
Separation update: This is the key. This is when we witnedssed big increases in the share price. Separation will again attract the attention. Once there is positive news and a focus on the separation, I think that we may see bigger increase. This is where GMA is different and and can create tromendous value.
Plan Nord: People can assess numbers. If the Quebec gvt put money in GMA, we may see an increase. First it gives credibility and second, we can easily assess the amount invested (and we can even compare it with the competition!)
Partners, offtake, joint venture, institutional investors taking a position in GM, etc... All kind of sign of confidence from a partner with money will be welcome and I hope that it will affect the share price positivly. We are a bit alone...
Coverage: No one that I know covers GMA. Lifton does not mention GMA often, as he feels he does not have enough information to make an appropriate assessment (I do not want to misquote him, so please see his comments on Investorintel in response to a question/comments from a certain Mr. Jimmy on GMA (which by the way strangely write like a certain Tiles) ). Hopefully in a not so distant future, someone will cover GMA and the stock may interest more people.
In conclusion, even though GMA seems to be going in the right direction with the news releases, I personally feel that we will have to wait separation news or financial agreements to get GMA moving. I really hope that I am wrong though!
But who knows, we may all get surprised and cheerful after the resource update.Maybe that would be the only missing pieces and Investors would be ready to jump in the train. Let's hope we see big increases really soon and good luck to all of you. And please remember that my comments are only a reflexion/hypothesis and I may very well be more than wrong with it. I just wanted to share and have your opinion back.
Moulouk