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Ready to benefit from the commercialization of Graphene
Alpha Deal Group considers Lomiko Metals Inc. (TSXV: LMR) (OTCQX: LMRMF) as a uniquely positioned junior graphite resource company and graphene technology incubator company with a current equity market price inefficiency at a significant discount to its intrinsic value.
Lomiko Metals holds the Quatre Milles Graphite property and the Vines Lake property. The company holds 11.23% interest in Graphene 3D Lab (TSXV: GGG). In the September 17, 2013 press release to the market, Lomiko Metals announced confirmation of their ability to turn graphite into graphene which represents tangible value creation and market sustainability. The company has a Strategic Alliance Agreement with Graphene 3D Lab (Graphene 3D) to access technology. This will give access to over 7,000 customers of Graphene 3D, and a potential to increase production from the company’s Quatre Milles property. We think the intrinsic value of the company is C$0.200 per share; this is an upside of 166% from the current market price of C$0.075 per share.
Valuation: Notable disparity between current price and intrinsic value
Lomiko Metals (TSXV: LMR) is currently trading at C$0.075 per share, with a market capitalization of C$9.56 million. The company holds 4.4 million shares of Graphene 3D (TSXV: GGG). The closing price of Graphene 3D (TSXV: GGG) on September 18, 2014 was C$ 1.33 per share. Lomiko Metals shares are worth C$5.85 million. As of April 30, 2014 the company had cash and liquid investments of C$ 4.86 million. Based on the current market capitalization of the company, there is a penalty of C$ 0.47 million on the company for holding mine properties.
We have valued the company at C$0.200 per share based on the potential to exploit the lithium-ion batteries, 3D printing solutions, and natural graphite market. We consider Lomiko Metals at current pricing and current timing a high Alpha opportunity.
The key drivers that could positively influence the share price are the results of Preliminary Economic Assessment for the resource estimation for Quatre-Milles, and commercialization of 3D print solutions. These events will help the street get a clear view on the business and can see the stock re-rated.
Certain statements in this news release may contain forward-looking information within the meaning of Rule 175 under the Securities Act of 1933, and are subject to Rule 3B-6 under the Securities Exchange Act of 1934, and are subject to the safe harbor created by those rules. All statements, other than statements of fact, included in this release, including, without limitation, statements regarding potential future plans and objectives of the company, are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and other results and further events could differ materially from those anticipated in such statements. Future events and actual results could differ materially from those set forth in, contemplated by, or underlying the forward-looking statements.