Post-Acquisition Enthusiasm Fades For Molycorp As Short Interest Continues To Climb [View article]
As long as short interest is this high and REO prices remain low, it will take a catalyst like the announcement of Mountain Pass production or another acquisition to lift Molycorp out of the trading range.
Lynas is similarly stuck in a trading range awaiting another catalyst event, but short interest is under 10 percent in Lynas.
The trend seems to be that REO companies have a difficult time maintaining share price while REO prices are dropping or remain near 52-week lows. Since Mountain Pass's acquisition brought about such great price spike, I sold in the $35s and will re-enter on either (1) a new catalyst for MCP or (2) if the PPS approaches the sub-$25 level again.
The only REE stock I am holding in this environemnt is Lynas, which is awaiting the temporary operating license (T.O.L.) issuance by the government. Back in February when the T.O.L. approval was announced, Lynas' share price rose quickly from $1.05 to $1.70, which provides a good indication of what the market will think once they are actually approved to start production in Malaysia. Meanwhile, the Malaysian elections and the lack of being 100 percent finished with the LAMP facility are holding a tight lid on share price for Lynas.
3 Oil And Gas Stocks With Rocketing Production By 2013, 1 To Avoid [View article]
While oil prices have plateaued recently, rare earth prices are still near the bottom and have only just begun to recover. Rare earths are a complex industry and remain a stock picker's market to discover companies emerging from the speculative development phase into actual production:
Molycorp (MCP) moved up 43 % from the lows a month ago when they announced an acquisition. The next rare earth stock to move will be Lynas ($LYSDY or $LYSCF): Lynas will be permitted to sell & export rare earth products at the LAMP during the plant’s trial run, the Atomic Energy Licensing Board (AELB) said today: http://stks.co/3KtV
Google Earnings Confirm Search Giant Is On Track To Set All Time Highs [View article]
While oil has topped out and the tech sector is on its way to reach a top at some unpredictaable point in time perhaps sooner than later, one sector that has languished is rare earths. Due to falling prices in 2011, several promising companies with new facilities soon to come into production are beaten down but have tremendous upside. Rare earths are a complex industry and remain a stock picker's market to discover companies emerging from the speculative development phase into actual production:
Molycorp (MCP) moved up 43 % from the lows a month ago when they announced an acquisition. The next rare earth stock to move will be Lynas ($LYSDY or $LYSCF): Lynas will be permitted to sell & export rare earth products at the LAMP during the plant’s trial run, the Atomic Energy Licensing Board (AELB) said today: http://stks.co/3KtV
Possibly The Most Undervalued Sector And Stocks [View article]
While oil has topped out and gold remains in a pullback as long as the Fed and Bernanke keep making noise about "there will be no more QE", rare earths have not yet reached their potential and remain a hot item in a stock picker's market to discover companies emerging from the speculative development phase into actual production:
Molycorp (MCP) moved up 43 % from the lows a month ago when they announced an acquisition. The next rare earth stock to move will be Lynas ($LYSDY or $LYSCF): Lynas will be permitted to sell & export rare earth products at the LAMP during the plant’s trial run, the Atomic Energy Licensing Board (AELB) said today: http://stks.co/3KtV
Today's Market News To Trade On: News Moving These 5 Stocks [View article]
While oil has topped out, rare earths have not and remain a stock picker's market to discover companies emerging from the speculative development phase into actual production:
Molycorp (MCP) moved up 43 % from the lows a month ago when they announced an acquisition. The next rare earth stock to move will be Lynas ($LYSDY or $LYSCF): Lynas will be permitted to sell & export rare earth products at the LAMP during the plant’s trial run, the Atomic Energy Licensing Board (AELB) said today: http://stks.co/3KtV
Risk Will Not Equate To Reward For The Near Future [View article]
While oil has topped out and creates a near-equal probability of gains versus losses in individual stocks, rare earths have not and remain a stock picker's market to discover companies emerging from the speculative development phase into actual production:
Molycorp (MCP) moved up 43 % from the lows a month ago when they announced an acquisition. The next rare earth stock to move will be Lynas ($LYSDY or $LYSCF): Lynas will be permitted to sell & export rare earth products at the LAMP during the plant’s trial run, the Atomic Energy Licensing Board (AELB) said today: http://stks.co/3KtV
Friday's Commodity News To Trade On: 5 Stocks Impacted By News [View article]
Molycorp is first in line to have their new plant go operational; this makes sense because stock price has already risen from $24 to $35.
Lynas (LYSCF.PK or LYSDF) is next inline to have their plant go operational in Malaysia. UGL resources has started disbanding their construction team for the LAMP, which means that the plant should be 100% complete within 1 to 1.5 months. Also, Lynas has been working with the IAEA, the AELB, the EPA, and the DOE in Malaysia for years and has completed a EIA and underwent audits. The government continues to indicate they are backing Lynas if they follow their regulatory framework.
Quantum Physics, Flash Crashes And Market Illusions [View article]
I know it would make for far less interesting journalism, but IMHO these types of market interpretation articles would be equally convincing and way more efficient for readers if the authors could remove all references to physics. Readers need to focus on the message content of this article without all the irrelevant hyperbole and fluff.
This is just a trend I have observed and nothing against any particular author. Financial writers recently have taken to comparing stock market behavior to the laws of physics in what appears to be either (a) an attempt to sound erudite or (b) an attempt to make their opinions more convincing by citing proven mathematical relationships in physics where mathematical relationships are absolute and universal, juxtaposed with opinions about stock market behaviors that follow nothing absolute, only guided by the ever-changing herd behavior and whims of a large collection of human beings running trades? Articles like this just make for "popcorn journalism" - read and enjoy, but take it all with a grain of salt. The fundamental laws of physics have no a priori truth in stock market economics. Maybe there is a place for some highly evolved mathematical prediction algorithms in HFT, but it isn't quantum physics.
2 U.S.-Listed China Stocks To Buy Now [View article]
My edit timed-out so this is a continuation of the reply to Marek.
I see that you have added advances to suppliers to actual inventory on-hand to come up with effective paid-for inventory as a measure of the use of the company's net income. I agree, the math itself makes sense, but I still question the timing and all the changing excuses for the last 8 months.
First, they were going to dilute, but did not and claimed it was not good for current shareholders, which I personally agree. Secondly, LPH claimed they came up with a total of $85M by June 30, which seems plausible but they greatly lowered advances to suppliers to do so. Since those "advances" are only as authentic as a letter provided to the auditor from the refinery, it makes you wonder if the down payment was really that much or was it inflated.
Third, LPH then claimed they would close the deal in the quarter which began 9/30/11, but that never happened. Why wasn't Toups informed if LPH decided to change their strategy from raising cash to close ASAP to instead putting cash to use as additional advances to suppliers? There were major advances to suppliers increases between 6/30 and 9/30, and also between 9/30 and 12/31. During the latter part of the latter quarter, crude prices had already increased dramatically so I would question why it would be beneficial to keep adding on to inventory under such conditions as the price of oil was starting to look top heavy before the end of the year.
Fourth, Toups has given conflicting explanations for the closing delay in conference calls. He has stated they were negotiating with the seller. If that was the true reason all along, then why not keep raising cash as oil prices topped out towards the end of 2011? And why not keep investors informed as to the true reasons for the delay. At this point, I am beginning to question if it isn't a combination of using advances to suppliers as an eggshell game for where the money is going, and using the claims of upcoming acquisition as a dangling carrot just to keep the share price up.
2 U.S.-Listed China Stocks To Buy Now [View article]
As far as the credibility that might be gained by (1) LPH's long-promised tax filings reconciliation between SEC filings reported earnings versus PRC official tax records and (2) LPH receiving an honorable mention from the provincial government, IMHO these two points do not and will not prove LPH has been honest with their tax filings. This weekend a new Bloomberg article came out which claims that:
"Chinese Companies Forced to Falsify Data, Government Says"
"China’s statistics bureau said local officials forced some hotels, coal miners and aluminum makers to report false numbers...Statistics officials in Hejin city in northern Shanxi province gave companies “seriously untrue” numbers to submit for 2011, the Beijing-based National Bureau of Statistics said in a statement on its website dated March 12."
2 U.S.-Listed China Stocks To Buy Now [View article]
I owned LPH in 2009-2010 from 2.25 to 3.52, and 2011-2012 from 0.89 to 1.62. Right now LPH investors are hoping the investment in Haujie Petroleum goes through. However, I am out for the time being, and do not regret getting out in the least. The reason is that as of June 30th, 2011, LPH claimed they had $86 million on deposit, which was consistent with their claimed earnings.
LPH still has not come up with the remaining approximately $25 million needed to close this deal over a long period of 8 months (July 1 2011 to February 29, 2012). Since LPH did not have any other large one-time expenses over that timeframe, this suggests that current net income is actually less than $25 million over 8 months, which would be equivalent to a rate of earnings for an annualized income of $37.5 million. However, SEC filings show LPH claims an EPS of around $0.67 with around 103 million fully diluted shares (in rough numbers).
So how can LPH claim to earn $66 million per year over the last 12 months, yet they cannot come up with a tiny fraction of that sum in 8 months - equivalent to a rate of earnings of only $37 million per year. Note: I am not nitpicking the last 5% of accuracy in the filings here, but these numbers are close.
If this inability to earn enough cash to close Haujie is purely the result of China's tightening the spread of oil seller's profits - they lowered the retail ceiling of gas in October 2011 yet about 2 months later refinery prices rose dramatically - then at a minimum this indicates LPH margins are severely held hostage to the PRC's whims. Another possibility is the Haujie deal has fallen through and no one wants to admit it lest the market reaction would tank the share price. A third possibility is maybe the Haujie deal was just a false dangling carrot all along, designed as a PR trick so that LPH could bolster investor confidence during the china RTO fraud-crisis of 2011 which caused LPH's share price to drop very low. No matter which of these options is the real underlying explanation, I am not very confident as an investor right now.
How To Avoid Running Out Of Money In Retirement [View article]
Technically, what matters most is the total rate of return, dividends combined with growth. An actively managed portfolio can do a lot better than 5% a year on dividends alone because of a much healthier growth component. The appeal of living on dividends alone is that you can clearly see that you are not depreciating the source of the income. You can also run an analogous calculation if the total market value of your portfolio increased by 15% in one year and then you subtract 5% that you liquidate for living expenses.
Post-Acquisition Enthusiasm Fades For Molycorp As Short Interest Continues To Climb [View article]
Lynas is similarly stuck in a trading range awaiting another catalyst event, but short interest is under 10 percent in Lynas.
The trend seems to be that REO companies have a difficult time maintaining share price while REO prices are dropping or remain near 52-week lows. Since Mountain Pass's acquisition brought about such great price spike, I sold in the $35s and will re-enter on either (1) a new catalyst for MCP or (2) if the PPS approaches the sub-$25 level again.
The only REE stock I am holding in this environemnt is Lynas, which is awaiting the temporary operating license (T.O.L.) issuance by the government. Back in February when the T.O.L. approval was announced, Lynas' share price rose quickly from $1.05 to $1.70, which provides a good indication of what the market will think once they are actually approved to start production in Malaysia. Meanwhile, the Malaysian elections and the lack of being 100 percent finished with the LAMP facility are holding a tight lid on share price for Lynas.
3 Oil And Gas Stocks With Rocketing Production By 2013, 1 To Avoid [View article]
Molycorp (MCP) moved up 43 % from the lows a month ago when they announced an acquisition. The next rare earth stock to move will be Lynas ($LYSDY or $LYSCF): Lynas will be permitted to sell & export rare earth products at the LAMP during the plant’s trial run, the Atomic Energy Licensing Board (AELB) said today: http://stks.co/3KtV
Google Earnings Confirm Search Giant Is On Track To Set All Time Highs [View article]
Molycorp (MCP) moved up 43 % from the lows a month ago when they announced an acquisition. The next rare earth stock to move will be Lynas ($LYSDY or $LYSCF): Lynas will be permitted to sell & export rare earth products at the LAMP during the plant’s trial run, the Atomic Energy Licensing Board (AELB) said today: http://stks.co/3KtV
Possibly The Most Undervalued Sector And Stocks [View article]
Molycorp (MCP) moved up 43 % from the lows a month ago when they announced an acquisition. The next rare earth stock to move will be Lynas ($LYSDY or $LYSCF): Lynas will be permitted to sell & export rare earth products at the LAMP during the plant’s trial run, the Atomic Energy Licensing Board (AELB) said today: http://stks.co/3KtV
Today's Market News To Trade On: News Moving These 5 Stocks [View article]
Molycorp (MCP) moved up 43 % from the lows a month ago when they announced an acquisition. The next rare earth stock to move will be Lynas ($LYSDY or $LYSCF): Lynas will be permitted to sell & export rare earth products at the LAMP during the plant’s trial run, the Atomic Energy Licensing Board (AELB) said today: http://stks.co/3KtV
Risk Will Not Equate To Reward For The Near Future [View article]
Molycorp (MCP) moved up 43 % from the lows a month ago when they announced an acquisition. The next rare earth stock to move will be Lynas ($LYSDY or $LYSCF): Lynas will be permitted to sell & export rare earth products at the LAMP during the plant’s trial run, the Atomic Energy Licensing Board (AELB) said today: http://stks.co/3KtV
Thursday Flip-Flop: Now Goldman Sachs Says S&P 1,250 Is Target [View article]
Friday's Commodity News To Trade On: 5 Stocks Impacted By News [View article]
Lynas (LYSCF.PK or LYSDF) is next inline to have their plant go operational in Malaysia. UGL resources has started disbanding their construction team for the LAMP, which means that the plant should be 100% complete within 1 to 1.5 months. Also, Lynas has been working with the IAEA, the AELB, the EPA, and the DOE in Malaysia for years and has completed a EIA and underwent audits. The government continues to indicate they are backing Lynas if they follow their regulatory framework.
Quantum Physics, Flash Crashes And Market Illusions [View article]
Quantum Physics, Flash Crashes And Market Illusions [View article]
This is just a trend I have observed and nothing against any particular author. Financial writers recently have taken to comparing stock market behavior to the laws of physics in what appears to be either (a) an attempt to sound erudite or (b) an attempt to make their opinions more convincing by citing proven mathematical relationships in physics where mathematical relationships are absolute and universal, juxtaposed with opinions about stock market behaviors that follow nothing absolute, only guided by the ever-changing herd behavior and whims of a large collection of human beings running trades? Articles like this just make for "popcorn journalism" - read and enjoy, but take it all with a grain of salt. The fundamental laws of physics have no a priori truth in stock market economics. Maybe there is a place for some highly evolved mathematical prediction algorithms in HFT, but it isn't quantum physics.
2 U.S.-Listed China Stocks To Buy Now [View article]
I see that you have added advances to suppliers to actual inventory on-hand to come up with effective paid-for inventory as a measure of the use of the company's net income. I agree, the math itself makes sense, but I still question the timing and all the changing excuses for the last 8 months.
First, they were going to dilute, but did not and claimed it was not good for current shareholders, which I personally agree. Secondly, LPH claimed they came up with a total of $85M by June 30, which seems plausible but they greatly lowered advances to suppliers to do so. Since those "advances" are only as authentic as a letter provided to the auditor from the refinery, it makes you wonder if the down payment was really that much or was it inflated.
Third, LPH then claimed they would close the deal in the quarter which began 9/30/11, but that never happened. Why wasn't Toups informed if LPH decided to change their strategy from raising cash to close ASAP to instead putting cash to use as additional advances to suppliers? There were major advances to suppliers increases between 6/30 and 9/30, and also between 9/30 and 12/31. During the latter part of the latter quarter, crude prices had already increased dramatically so I would question why it would be beneficial to keep adding on to inventory under such conditions as the price of oil was starting to look top heavy before the end of the year.
Fourth, Toups has given conflicting explanations for the closing delay in conference calls. He has stated they were negotiating with the seller. If that was the true reason all along, then why not keep raising cash as oil prices topped out towards the end of 2011? And why not keep investors informed as to the true reasons for the delay. At this point, I am beginning to question if it isn't a combination of using advances to suppliers as an eggshell game for where the money is going, and using the claims of upcoming acquisition as a dangling carrot just to keep the share price up.
2 U.S.-Listed China Stocks To Buy Now [View article]
2 U.S.-Listed China Stocks To Buy Now [View article]
"Chinese Companies Forced to Falsify Data, Government Says"
"China’s statistics bureau said local officials forced some hotels, coal miners and aluminum makers to report false numbers...Statistics officials in Hejin city in northern Shanxi province gave companies “seriously untrue” numbers to submit for 2011, the Beijing-based National Bureau of Statistics said in a statement on its website dated March 12."
http://bloom.bg/yZTj60
2 U.S.-Listed China Stocks To Buy Now [View article]
LPH still has not come up with the remaining approximately $25 million needed to close this deal over a long period of 8 months (July 1 2011 to February 29, 2012). Since LPH did not have any other large one-time expenses over that timeframe, this suggests that current net income is actually less than $25 million over 8 months, which would be equivalent to a rate of earnings for an annualized income of $37.5 million. However, SEC filings show LPH claims an EPS of around $0.67 with around 103 million fully diluted shares (in rough numbers).
So how can LPH claim to earn $66 million per year over the last 12 months, yet they cannot come up with a tiny fraction of that sum in 8 months - equivalent to a rate of earnings of only $37 million per year. Note: I am not nitpicking the last 5% of accuracy in the filings here, but these numbers are close.
If this inability to earn enough cash to close Haujie is purely the result of China's tightening the spread of oil seller's profits - they lowered the retail ceiling of gas in October 2011 yet about 2 months later refinery prices rose dramatically - then at a minimum this indicates LPH margins are severely held hostage to the PRC's whims. Another possibility is the Haujie deal has fallen through and no one wants to admit it lest the market reaction would tank the share price. A third possibility is maybe the Haujie deal was just a false dangling carrot all along, designed as a PR trick so that LPH could bolster investor confidence during the china RTO fraud-crisis of 2011 which caused LPH's share price to drop very low. No matter which of these options is the real underlying explanation, I am not very confident as an investor right now.
How To Avoid Running Out Of Money In Retirement [View article]