is first cobalt a good stock to buyjoe's original dartmouth menu

Understand the cobalt market with our 2020 FREE Report Cobalt Market Forecast and Cobalt Stocks to Buy in 2020. In copper, Trilogy Metals and Pacific Booker are up an average of ~250%.
Table of Contents. Similarly, FCC’s beta value conveys the same message. Compare that to the company's Enterprise Value [market cap + debt – cash] of ~C$43 million. First Cobalt's refinery simply does not carry that kind of risk. During times of economic downturn, low demand may cause companies to readjust production of their goods and services.

There are few options outside of China to produce cobalt sulfate for the battery market, and management says there's no other near-term refining prospect in North America.How much revenue could the refinery generate? However, to be clear, there's no guarantee of a meaningful rebound in price.I fear that investors are treating the estimated replacement value of the refinery like they would the Net Present Value (NPV) of a mining project.
It has a lot of boxes checked, but at the same time, is still relatively early stage. Energy Fuels, an established uranium/vanadium producer, trades at 11.8x trailing 12-month revenue. The U.S. is not low on cobalt supply…it has NO domestic cobalt supply!In addition to controlling ~45% of the past-producing Cobalt, Ontario, Cobalt-Silver camp, First Cobalt owns 100% of a fully permitted, primary cobalt refinery. This one has a resource (26.9 million tonnes) that will be upsized by up to 50% (my guess only) this quarter. According to this value of beta, FCC can help magnify your portfolio return, especially if it is predominantly made up of low-beta stocks. View real-time stock prices and stock quotes for a full financial overview. That funding should be achievable through a combination of debt, equity, streaming/royalty financing, and/or selling a portion of the asset.Nearly 1,000 words in and I haven't discussed First Cobalt's flagship project, Iron Creek in Idaho (U.S.). SQM, a large lithium producer, trades at 4.8x.

With a market cap of CA$246.89M, FCC falls within the small-cap spectrum of stocks, which are found to experience higher relative risk compared to larger companies. After soaring past $83,500 per metric ton (MT) in March 2018, cobalt prices began this year at $55,000 per MT. In fact, the batteries are comprised of several elements. If the market is going up, a higher exposure to the upside … The grade is low, so I asked CEO Trent Mell about that. As more boxes get checked, like the upcoming resource update at Iron Creek, ongoing metallurgical testing, lining up feedstock and funding sources for the refinery…this de-risking should get noticed by the market. I defer to industry experts Benchmark Mineral Intelligence.

That would be a 15% CAGR. With a beta of 2.03, First Cobalt is a stock that tends to experience more gains than the market during a growth phase and also a bigger reduction in value compared to the market during a broad downturn.

FCC | Complete First Cobalt Corp. stock news by MarketWatch. According to this value of beta, FCC can help magnify your portfolio return, especially if it is predominantly made up of low-beta stocks. The price was >US$40/lb less than 12 months ago, and at US$25/lb less than three months ago.For those fearing that cobalt is being engineered out of electric vehicle (EV) batteries due to high cost and/or security of supply concerns, they are only partially correct. The most widely used metric to quantify a stock’s market risk is beta, and the market as a whole represents a beta of one. I believe it will remain in strong demand, and that North American sources will be highly sought after. Thus, we can expect FCC to be more volatile in the face of market movements, relative to its peers of similar size but with a lower proportion of fixed assets on their books. I'm not suggesting the price will soon soar, but a near doubling in the price to US$25/lb in the next year could propel the best positioned companies higher, perhaps a lot higher. This is consistent with FCC’s individual beta value we discussed above. A Swiss mining giant with a market cap of $58 billion, Glencore PLC (OTCMKTS:GLNCY) produces more cobalt than any other company in the world.

So, there's high return potential, with commensurate high risk.

It can produce cobalt sulfate or metallic cobalt products and is the only one of its kind in North America.

Therefore, this is a type of risk which is associated with higher beta. I examine FCC’s ratio of fixed assets to total assets to see whether the company is highly exposed to the risk of this type of constraint.

By contrast, there are a number of Australian nickel-cobalt deposits that have the tonnage but lower grades than we have at Iron Creek. That, and the estimated value of the refinery being three times larger than the company's entire Enterprise Value, suggest today's share price could be an attractive entry point.Streetwise Reports is registered with the U.S. Patent and Trademark Office. As mentioned, the price was > US$40/lb less than 12 months ago. In other words, grade is worthless without sufficient tonnage. Next, we will examine the fundamental factors which can cause cyclicality in the stock.

Moreover, FCC’s industry, metals and mining, is considered to be cyclical, which means it is more volatile than the market over the economic cycle. But on the other hand, the dividend yield has increased to a stro… That means investors today get the company's flagship project in the U.S. for free, plus 50 past-producing mine sites in Cobalt, Ontario, with a large margin for error embedded in the estimated value of the refinery.There's considerable risk for mining projects at PEA or PFS-stage. Note: This article was first published on Trend Investing on November 19, 2017, therefore all information is as of that date. The market for natural resources remains subdued, but there are pockets of strength. What I have not mentioned in my article here are important company-specific fundamentals such as First Cobalt’s financial health and performance track record. Cobalt is used to make stainless steel, medical prostheses, diamond tools, and more.

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