Home » Uncategorized » Developer Discount or a Fatal Flaw? A few charts

Mr. Market has been hammering all but the absolute best projects out there. To be fair, even some of the best projects have been hammered (one such project is below).

Juniors in the development stage (engaged in feasibility studies, attempting to secure financing to build a mine/in the process of building a mine) are notoriously discounted. This is for good reason. The euphoria of the discovery and the pie in the sky hopes and dreams of speculators have worn off and everything crashes back down to earth. Concepts such as CapEx, OpEx, and Free Cash Flow become cold, hard realities. This is sink or swim time for a junior miner.

Speaking for myself as a small time speculator, it’s been a hell of a tough time in situations like this trying to discern the difference between a screaming buy and the market telegraphing there’s a fatal flaw with a project and to stay the F away.

I will note this isn’t really a fair comparison as there are several different underlying commodities represented. The “clean energy” stocks (lithium, cobalt, graphite) are a beast unto their own and are extremely sentiment driven.

I’m not going to name names, but I think there’s at least 1 screaming buy below, and lots of losers who will never make it. Would like to hear your thoughts in the comments.