Q: Potash is a commodity, this is one of the stock i came across, is this a good buy? Thoughts?
5i Research Answer:
MLP is up more than 400% this year, bringing market cap to $166M. It just raised $9M and had $3M cash at its last report. It has no sales yet and lost $1.6M in the last quarter. Cash flow was negative. Insiders own 35%. Management has good experience. The company's project in Gabon has robust economics, with a solid preliminary economic assessment showing a 35% return potential. But it is still early days here and there are a lot of risks. The company does not also have a long history. Interesting, but highly speculative. There will be time to buy this as it moves forward with development. After such a dramatic rise we would expect some price consolidation, especially after a financing.