If funding can be fixed for a number of years at a low rate, we could be safe taking on a bit of serviceable debt.If the massive debt is on a fixed rate,it is genius.on a floating rate,i agree a looming disaster
There could be a couple of substitutes for the magnets, but I don't think the whole spectrum of rare earth metals could be replaced easily.Rare earths sector at risk of more substitution if prices spike
Demand for rare earth permanent magnets is due to soar as governments and companies step up efforts to cut carbon emissions.www.mining.com
Interesting counter article, essentially claiming that rare earths can, and likely will be, replaced by other metals should they become too expensive.
I think it is a bit like batteries, you can make Li-Fe batteries for a lot less than Li-ion batteries, the same as you can make evaporative air conditioners cheaper than reverse cycle air conditioners.There could be a couple of substitutes for the magnets, but I don't think the whole spectrum of rare earth metals could be replaced easily.
There's no question about batteries I believe. Who wants something that has to be charged all the time due to poor components ?I think it is a bit like batteries, you can make Li-Fe batteries for a lot less than Li-ion batteries, the same as you can make evaporative air conditioners cheaper than reverse cycle air conditioners.
You just have to decide what suits your needs.
Best you decide, on which to back.
Just my opinion, but it is a very important point IMO, rare earths give better electric motors, nickel, cobalt and lithium give better batteries.
You have to decide which will get the better market traction, cheap and cheerful or more expensive and more bang for your bucks. ?
I have to admit, the last two announcements have boosted my opinion of VML compared to when I sat through their last intevstor presentation.
Looks like we can now get an approx. value for both UCore and REEtec contracts..
Agree @waterbottle This presentation was specific and well presented.
I haven't done any figures on the potential value of their "shorter term" objectives, but I am happy to accept Geoff Atkins's supposition that Stage 2 will be predominantly funded by Stage 1 + debt funding (ie. Minimal Share-holder dilution)
and Stage 3 (Kipawa) may eventually help them achieve their stated objective, to become "the next Lynas" (their words)
I'm personally playing the long game with this one, but everyone's trading position is different of course.Still early days for me.
I'm with you @barney when I was working a mate was buying Lynas for a few cents, we are talking probably 12-15 years ago, I didn't bother back then I was chasing fast turnover, not so much these days. I have a bit more patience now.Agree @waterbottle This presentation was specific and well presented.
I haven't done any figures on the potential value of their "shorter term" objectives, but I am happy to accept Geoff Atkins's supposition that Stage 2 will be predominantly funded by Stage 1 + debt funding (ie. Minimal Share-holder dilution)
and Stage 3 (Kipawa) may eventually help them achieve their stated objective, to become "the next Lynas" (their words)
I'm personally playing the long game with this one, but everyone's trading position is different of course.Still early days for me.
Look I don't know if i'm right or wrong, but taking the example of Lynas, I'm pretty sure he bought in at around 8cents, I might be wrong my memory usually is good though.Great to have a few fellow ASF members cover VML, it just gives you that little bit of confidence to hold through serious pull backs and boring consolidations.
Me too, going to sit on this one with a longer term horizon and watch it's progress.
Look I don't know if i'm right or wrong, but taking the example of Lynas, I'm pretty sure he bought in at around 8cents, I might be wrong my memory usually is good though.
Now even if he only bought 100,000 at that and put them in the bottom draw he has done well, that is the reasoning i'm using.
I've bought some shares and sold them for a nice profit, eg 2,000 CSL @ $27, sold them @ $30, nice little flip tucked it away and moved on to the next one, MQG after the gfc nice pick up at around $15 from memory, flipped them at around $30, great pick up moved on to the next one.
I'm a bit older and a bit more patient these days.
Just my thoughts.
That is exactly what I'm getting at, also being based in North America, there are some very rich companies there that can pick up a company like VML, for ashtray money.And more importantly, VML now has an established plan towards earnings of approx 500 million pa usd within the next 10 years. I have no doubt that will increase once as rare earth demand increases, VMLs network expands and the West pulls away from China.
With a conservative PE of 20, that would put VML at 10bill market cap within 10 years I. E. Share price of $2 within 10 years.
That's my whacko back of the envelope valuation
$10b whoaAnd more importantly, VML now has an established plan towards earnings of approx 500 million pa usd within the next 10 years. I have no doubt that will increase once as rare earth demand increases, VMLs network expands and the West pulls away from China.
With a conservative PE of 20, that would put VML at 10bill market cap within 10 years I. E. Share price of $2 within 10 years.
That's my whacko back of the envelope valuation
Ah aus IMO you are starting to see the light, stocks aren't IMO one dimensional, so you have stocks that are holders for income, while you don't need the income, you have dividend reinvestment and add to them when they tank eg(WES)$10b whoa, bit on the high side I think, I mean It'll be nice of course if VML gets that big. Even the biggest RE stock on asx LYC is only just over $6b, so just trying to put things in perspective.
What @sptrawler said is quite insightful however, i.e. to just hold few of the good ones right through. He knows about MCR that I sold far too early to realise a modest profit. Most of you guys know about my ASM (another RE stock) stuff up when I sold it as soon as it was spun off by ALK, and then it went on to become a 12-bagger at it's recent peak. These are not some hypothetical missed opportunities, but actual purchased and sold stocks as documented in Speculative Stock Portfolio. So I'll have to exercise some patience with VML.
Good analysis @waterbottleBig drop for Lynas today, although some important insight into rare earths offered....
Lynas expecting an increase in rare earth demand heading into 2022. Seems that they were limited by COVID outbreaks at their processing facility and limited access to shipping.
They're expecting a stronger rare earths market over the next 3-4 years.
I'm not too familiar with the company but it seems like they're trying to establish an Australian rare earths processing facility at Kalgoorlie and have recently received a recommendation from the EPA.
According to their earnings call, their production has fallen victim to COVID, global shipping woes to and from Malaysia, limited environmental approvals from the Malaysian government, and the cost needed to transport waste from their Malaysian processing facility back to Australia.
Their Kalgoorlie strategy may be an attempt to mitigate any future disruptions.
VML seems to be ahead in that regards with a facility already under construction with government support.
There was also mention of a US project by 2025, but nothing of substance mentioned in the earnings call.
My interpretation is it's a project that isn't a definite go ahead, and therefore may be available to another competitor.
VML seems to be making inroads into US markets through private companies (UCore) as opposed to government.
For comparison's sake LYC produced approx 16 000t/pa of REO @ 6 billion AUD market val.
VML will be producing close to 2000t/pa of REO in 2022 @ 250 million AUD.
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