RE:Hallgarten&CompanyThe heralded demise of PGMs is stock-in-trade for the EV boosters in the equity markets. Their theory goes that EVs will conquer the world and they cannot foresee that there may be pushback against this, or logistical issues to mass switchover or consumer resistance. There can be no remnant ICE market in their tunnel-vision of the future. There will be no survivors and there will be no demand for metals associated with the old technology, only for the new. The only problem with this scenario is that, except for China, this revolution has not even made a dent in ICE consumption or production. Moreover the construct for the future is built upon the shaky ground
The main priority for New Age now is its ongoing search for a strategic partner for the River Valley project. While the company has diversified its interests into Lithium, it’s more PGM projects that the market needs at this juncture. With the prices for this rarified group of metals having shown a healthy rebound in 2018, those investors in search of the next companies to move towards (non-African) production have little beyond New Age and Nickel Creek Platinum (the former Wellgreen) to conjure with. C
onsidering that the recovery in PGM prices is now no longer in question we must wonder why the market seems to have missed the intrinsic virtues of the River Valley Project. We suspect it is more a case of the Canadian investor community still being in thrall to the gold price even when the gold price is quite patently not delivering. When one overlays the industrial necessity for PGMs and the fact that the two largest producer nations are somewhat erratic there would appear to be space for the two challenger companies to join the two existing plays (North American Palladium and Sibanye-Stillwater) in the universe for consideration. At its current market capitalization New Age is patently undervalued on the basis of its sizeable in situ resource of PGMs. Therefore, we are rating New Age Metals as a Long call and our twelve-month target price of $0.18.