LYC 0.00% $2.60 lynas corporation limited

Was not going to comment onthis. It is bugging me. Yes license...

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    Was not going to comment onthis. It is bugging me. Yes license issues havehad a direct impact. I have been saying for over two years thiswould come out fine and it was overblown. In reality it has been OKbut not fine. The disposal of waste and moving of C&L will be have cost it remains to be seen the impact.

    Until H1 2018 the company never made a profit. At that time Revenue was not as important, what was important is actions that would help the company be profitable or cause expenses that decreased profits. License issues and one month production shut down hurt this. Ultimately all that counts is current profits and potentials for future profit. You buy a stock mainly because you hope for higher future value measured in book value. (ignoring dividends for right now) The only thing that increases book value is earnings. There are many fixed expenses. There are also varble expenses which vary with volume of product sold. Offsetting this is revenue. which is product volume times price. Lynas has been in production for 5 to 6 years. Profitable to some degree for 2 full years. At this time production volume is fixed. 2025 plans will improve this but we will not see much change for 2 or 3 years. Right now volume is down because AL has decided to withhold product till prices increase. So even this is tied to ND price. As the company matures investors will want to see a growing and consistent earnings. That is directly Tied to ND prices.

    La and CE are very stable not sayingthey are not important there is just not any change there. NdPR tracts Nd very closely so watching Nd covers that. Pr also tracks Nd but not as tightly as NdPr. It is only 5% of total volume. So I am happy to track only Nd.

    As license issued are resolved focus will change to earning. Nd prices will become an excellent forecaster of earnings. This change will have both a short term a few days and long term, 90 to 180 days, impact. Change will be measured in the % change of the delta between break even pricing and current price. This shows the true impact on earnings. For example if BE is 250 RMB and prices go from 300RMB to 350 RMB you can expect about a double in earnings. Which should double the stock price. Just an example. I think BE is higher than 250 RMB but I will keep that to myself for a while. Too many things are changing.

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