One possible outcome if Cypress takes this to productionSo check out this scenario which is not to far off in the future. CEO Bill is on record that taking this project all the way to production is in the cards. OK, fine so lets do some math around that assumption. Current nimbers are based on a 27.5K per year output. Let's say they do upsize it to 50K a year. That is less than a double. Let's say they get $50K per ton. Much less than the current spot price. Let's use current the fully diluted share count of 175M shares. Let's take a price to sales ratio of 3. Which is lower than current producers ALB, Livent, and SQM. So by all estimates these are conservative date points (outside of the upsize 50K tons).
Do you know where that puts the share price?
$42.85 per share. Out of this world valuation from current level. I for one think an offer comes along before that point, but based on those numbers what is a fair price? I say no less than $20/share to buyout the project. The mines payback to life ratio at current prices could be as high as 20:1 with it taking only 2years or less to payback the mine on a 40 year mine life. My minimum price to accept a buyout starts at $20/share. Otherwise we take it to production.