Sirius Minerals Share Discussion Threads

[johnwise] 03/4/2018 13:09

Why is Sirius Minerals PLC suddenly so popular?



Sirius Minerals PLC (LON:SXX) (SXX.L) has seen a surge in investor interest in recent months

And since the stock trades at less than 15% of its NPV, there seems to be scope for a higher valuation.

[chrisatbirdies] 03/4/2018 12:26

Absolutely thanks. I will read again later.and see how much sinks in lol.

[teataster] 03/4/2018 12:21

PPVN, thank you for another interesting and valuable read.

[ppvn] 03/4/2018 11:38

Hello, so I see Sirius is once again defying the broader market and continuing its upward climb. So I mentioned that I would put together a few notes as to why I’m getting increasingly optimistic for this year’s shareprice movement; basically my rationale is outlined below. As ever, please add or comment wherever any omissions or observations are made (or if I need to clarify any points).

In order for me to explain, it’s important to keep in mind the structure of the Stg1 finance deal – essentially it leaves Sirius with no debt element once it has been completed (I consider the conversion of our CBs as part of the Stg1 finance so am excluding these from debt – they are to be converted to equity). So what does this really mean? To me, it means that Sirius have raised $1.1bn (net), and spent that on the development of Woodsmith (i.e. moved to fixed asset). I’m aware that there has been spend on R&D of Poly4, operating expense, other various admin etc, but I’m simplistically (and relatively inaccurately) illustrating that rather than the balance sheet being “hopes and dreams” on the one side, and “liabilities” on the other, there are now $1.1bn (£780mm at todays FX) of fixed assets of tangible value assigned to Sirius, once CBs have been converted. Prior to Stg1 finance, all the previous years work done – planning, licenses, permissions etc etc were the only real value that could be assigned – and considering there were c. 2.3bn outstanding, that valued the company at around £460mm @ 20p, £920mm @ 40p etc. Now I’ll leave it to you to decide how much value you want to place on a > 100 year resource that should eventually turn out 20mm TPA of Poly4, but my personal view is that its north of £1bn, considering the structure of Stg1, the progress made since 2016, etc etc. To that figure you assign, you can also really add the £780mm of fixed assets that now appear on our balance sheet, since any other operator would need to spend that money to have got to where Sirius currently stand. So around £1.7bn as “fair value” – or around 37.7p at current value (using 4.5bn shares in issue as we currently have, but that will rise to around 5.45bn in due course). But that’s taking the value of Woodsmith @ 2016 value with no derisking since, and really only the value added via the Stg1 finance – so I’m of the opinion this is conservative. And this is because of our CBs – funds still need to dispose of their CBs by selling shares into the market, which they are indeed doing. I view the share price range we are in as under true value for the reasons outlined above; once the supply from our CB holders is gone this is why I personally think the share price will move to an entirely new and higher range. I still personally view offtake agreements and more obviously Stg2 finance updates as the most important news we can get that’ll help move our price north, but you can apply your own critical news for that.

Finally, some colour on what I’d personally do if I was looking to trade this share (I’m personally planning to just hold as I’ve said many times – newsflow could rapidly change the market dynamic for this share in my opinion). Market volume is still rising, but we still need more in order for our CB holders to be able to exit. Today we have traded 16mm shares which is good, but we still need more. I’d expect us to close with >30mm shares traded today. Don’t forget that if the share price opens at 30p and moves rapidly to 32p, psychologically 31p would be a relative bargain if anyone was to be looking to buy the share (so it’ll increase volume if the price were to drop, cough cough…). If volume remains at this level or increases a bit I’d personally expect us to rise to the mid 30’s – perhaps slightly more than 35p, and drift back if volume drops (but I don’t really see much drift below 30p now) or remain stable, if volume remains decent. Watch the volume, if it increases we are less likely to drift back, if it falls we are more likely to. Aftermarket volumes are particularly important to watch at this juncture since this is the only real-time visibility we have into what our CB holders are managing to sell. I’d like to see a new blocklisting RNS in the next few weeks – that’ll mean that since Jan a further 227mm or so shares have been cleared from our CB holders via conversions. Look for declared short interest to change – I note GSA have reduced by 4.5mm which in my view indicates they at least have been converting bonds. Speaking or our bonds, they are currently @ $154.59, which indicates a secondary market value of $309k. $350k for 20 consecutive business days is the level where Sirius can call on 19th Dec, assuming 1,700 haven’t already been converted by then. Finally, please be aware of what Sirius represents at this point (i.e. a share that requires patience). I view this share as undervalued, but that’s my opinion and no more valid than anyone else’s. We will however need to be patient in order to clear this trading range, and market volume is the only way we will do this.

[y1phr1] 03/4/2018 10:48

Here here totally agree

[johnwise] 03/4/2018 09:52

Hello 11_percent Another Day off from the council recycling yard ?

[11_percent] 03/4/2018 09:48

so for me I shall sit on my hands at least untill stage two is called.

==========

Indeed....its all Stage2 finance now.

[johnwise] 03/4/2018 09:42

Yes, 5 to 7 years time travel first class

[chrisatbirdies] 03/4/2018 09:40

christopher logsdon.
Hi Christopher.if we had a better idea on how much and when dividends will be on offer then we could put our own value on the share at this point and trade to suit.alas however it is but a guessing game,so for me I shall sit on my hands at least untill stage two is called.

[christopher logsdon] 03/4/2018 09:18

I'll have a first class ticket please travel time 5 to 7 years

[mail2] 03/4/2018 09:16

yes. price blown though today leaving rest of market. 32.00p now

[johnwise] 03/4/2018 09:12

Last opportunity to buy a cheap ticket for the Train going North to Whitby, North Yorkshire 31.80 pence

[johnwise] 03/4/2018 09:08

The Northern Echo


Sirius says Strabag will oversee polyhalite transport system that will connect Woodsmith Mine with Teesside handling base

[christopher logsdon] 03/4/2018 09:06

Will sell 50k at 50p just in case!

[christopher logsdon] 03/4/2018 09:05

I really would like to trade this but I never get the timing right........... do we have any bids higher than 38p !

[11_percent] 03/4/2018 09:00

Next leg up.....next stop 38........

[johnwise] 03/4/2018 08:56

The Northern Echo

Sirius says Strabag will oversee polyhalite transport system that will connect Woodsmith Mine with Teesside handling base

[rrrrrrrrr2] 03/4/2018 08:40

Mail2. Perhaps you did. At 31p now.

[hazl] 03/4/2018 08:38

There she climbs........8-)

[ppvn] 02/4/2018 21:15

Evening NMRN, ha, well more a bit of gentle sarcasm really. Interesting that the techs seem to be breaking down somewhat in the US; been an awfully long time coming really (and I'm not convinced this is "it" just yet). For the FAANGs to be valued on a couple of hundred times p/e (for the ones that even have the 'e' part) is and has been ludicrous in my opinion and another reason I bought this particular share to just hold. Other shares keep me entertained but to trade this one seems a little pointless to me - more to be made elsewhere really.

[eurofox] 02/4/2018 20:53

we could all do with a pull-back in SP, but right now the PPT are on the job

[not my real name] 02/4/2018 20:39

Do I detect a hint of irony PPVN?

NMRN

[ppvn] 02/4/2018 19:57

There has indeed been a very strong correlation between the Sirius shareprice and the market top that came in Jan...