RE:RE:RE:RE:RE:Canacord genuity price target Trunorth2019 wrote: Just an unsubstatiated price target ?
how do you guys arrive at these prices....
I think it all, including Canacord is combination of guesses and wishful thinking. It does not mean that they will be wrong as some wishes comes true. S/P jumped over last two weeks due to slight increase in Li spot (confirming the tendency) and approval of Biden's infrastructure plan (which incl. EV infrastructure).
NLC caps. now is over 600M. It maybe somewhat too high, but DFS and drillings are on the way.
What capitalization is reasonable if DFS is done and resource is up 20%? Both are due by December.
Say 700-800M? Also a guesstimation.
Let' say begining of production valuation 1.8B is reasonable.
It is 2023.
30% dilution would shave 500-700M.
Financing and WIP is 2022, should bring 350M additional valuation.
Which leaves $750M for 2021.
DFS, EIM, drilling, increase quality of deposit (less inferred resources, more reserves), plus micro news should justify this valuation.
All worth about 200M.
Thus, presently NLC can be seen either slightly overvalued ($4.20 is reasonable) or it includes expectations of DFS+ news (likelyhood that DFS will confirm PFS is very high).
Of course, external news will bring corrections (faster/slower EV adoptions, faster/slower supply addition, spot prices, pandemic/ or its end).
1.8B may seem to be conservative, but I rather be cautious. Also, begining of production is another cycle of growth.
So: end of the year $6.25 (assuming all goes as planned)
2022 should add $2.50 (financing, engineering, construction).
2023 another $2-$3 depending on dillution, speed of construction.
Thereafter? (expansion, production success, first profit margin news.....)
Reasonable external factor may add or substract $1-$3 at any point.