A lack of transparency (particularly when accompanied by high demand) tends to benefit the seller doesn't it?
Thats the beauty of the situation - not the problem - imho.
May confuse the share investor but the individual buyers of lithium have been in such desperate need that they have been paying much higher prices for smaller amounts than even the ones I've mentioned. (according to some recent news items on Asian Metals).
Without a spot price - the seller can just demand what he wants and the buyers don't even have a solid frame of reference. There aren't many sellers on the spot market at the moment. Almost all production is tied up by the Big 3 filling the big-boy contacts.
Spodumene doesn't even have anything close to the sort of organised market that lithium has. Its not even a listed mineral on any market I can find anywhere. Its all virtually a closed circuit between mines and converter plants.
btw: According to Canaccord, Mt Cattlin just become one of the 5 largest producing lithium operations in the world.
Not bad eh?
Of course, GMM doesn't have the time to parcel out their spodumene in small lots. GMM rely on bulk sales orders - but even still. As long as it stays in the $13k-$20k channel that its predicted to then we have every reason to be bullish on higher spodumene prices for the short and medium term. Anthony Tse mentioned a 20% increase - but then proceeded to lay the case for even larger increases.
April brought some showers and Tesla Mk3 hit the news and a crop of investors forming a new wave of interest to all lithium stocks. People without much time to research piled in across the whole sector.
I don't think they paid much attention to whether a stock was in production or just readying a drill.
Along with them came some short-term and swing-traders who sensed they could profit from the spike.
1 week of frenzy up and down. Massive 20-30% increases that were too tempting for the swing traders.
Thats how I read it. All li stocks got hit because they'd all spiked.
The buying here may have related to value - but the selling became panic.
Now the rapid 60-70c spike is washed off GMM is already back in its groove. Unlike the juniors without production there is a good solid company here that is making a lot of hay while the sun shines.
Those who held through the drop will be fine even though some like our OP are left a bit confused and under-water for the moment.
Some nerves still need to settle down I think or buyers (like me!) will just continue to take their shares off them way too cheaply. Canaccord's valuation was too low - but its a realistic price for this to hit in the not-too-distant.
Our market-cap is still on the ridiculous side of low.
Wise words about the value and time targets @The Samurai .
Personally, I'd like to ride this company for the long-term.
Being mindful when substantial things change, of course.
James Bay and perhaps even the next asset that comes their way - perhaps even a cut of SDV.
No doubt there will be more dips and fast rises along the way but I can be very patient when it comes to good stocks.
GMM Price at posting:
55.0¢ Sentiment: Buy Disclosure: Held
