We increase our valuation of Almonty to C$1.29/share, mostly owing to strong FY14 financial results. We believe the Woulfe transaction could be positive for the company, if it manages to retain IMC as a strategic partner on mutually beneficial terms. Overall, we maintain our positive view on the stock as we believe Almonty continues to provide attractive turnaround potential coupled with growth optionality.


We revise our base case valuation of Almonty from C$1.05/share to C$1.29/share. This upgrade is primarily driven by the strong FY14 financial results and the mark-to-market exchange rate adjustment, which was in part offset by the lower APT price assumptions. Overall, we maintain our positive view on Almonty, which continues to combine attractive turnaround potential with growth optionality. That said, current tungsten price weakness increases the execution risks, leaving no room for mistakes, especially for companies with relatively low-quality assets.


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