RE:$65 a shareFirstly, I think everyone belives that CYP is undervalued here. But at the proposed production in the PFS the extra reserves will only add life to the reserves but not much NPV. The only way to extract more NPV is to increase the daily throughput. This will require more water, bigger plant etc. These things typically don't scale forever. So you will be left with a smaller NPV than you are extrapolating. The question is how large could a plant be? At that size CYP will probably have more than 40 yrs reserves.
yakattack wrote: Do I have your attention? Good. Now read.
CYP's NPV(8%) using the current $13k/tonne pricing is equal to US $1.88 billion, or C$2.35 billion
Given the same valuation model as Piedmont is trading (ON THE MARKET!), currently trading at 127.4% of their NPV(8%).. CYP should have a market cap of
C$2.99 billion.. or roughly C$20/share ....
That's accounting for 1/4th of the project with the past (lesser) extraction tech using sulphuric acid, numbers will be even better with hydrochloric acid.
MASSIVE
Now here's some food for thought..... if the market values Piedmont at over 1 BILLION for their project, which is less than 1/10th the size of CYP.... if you were to simply compare project size to market value.... that would mean that CYP is worth over 10 BILLION.... or north of $65 a share (if the entire project was to be utilized).
This does not account for REEs either - just existing valuations...
Will it get to $65 a share? No.
Should it get to $8-$10 a share, to be followed by a proper premium of 80-100% for $15-$20+ a share? It's possible - and it should be done.
Any NDA knows very damn well what the numbers would be post-pilot. Makes no sense to drag this on and on.
I cannot see CYP being purchased for $7-$8 a share... because that would only be equal to existing peer averages. You don't get a buyout offer that is the average of existing market caps for your competition.
This means $10+ a share - and it better be before August.