Q: Can you please share your assessment of this company? Looks like they have just announced a definitive feasibility study.
5i Research Answer:
FL is now $120M market cap, up 20% this year. It has no revenue yet, losses and negative cash flow. It has about $20M cash. Insiders own 16%. The study shows a 31-year potential mine life for its PAK Ontario Lithium project. The study talks up numbers a lot, but the expected rate of return is 17.9%, which is fairly low vs other studies, especially considering $1B in capital costs. This is not to say it is not a feasible project, but a higher IRR would be better. There is work to be done still here and of course financing will be needed. We would consider it OK, but there remains a lot of risks here too as well.