Its like the emotional gambler that runs to the ATM one more time convinced if they can just get another $1000 off their credit card that slot machine will pay off. So you have the delusional bagholders hoping and praying. But the majority of the longs on this board are actually making a fortune selling call and put options to naive people - - and predictably nearly all those options get wiped out on options expiration date. This stock exists in my humble opinion so Scam Street can make millions of dollars each month shorting and selling options. Most manipulated stock in my investing lifetime in my humble opinion. It is so blatant, so obvious. More dilution and eventual bankruptcy coming in my opinion. Question is how many naive investors will go down with the ship, and how many more millions of dollars will Scam Street make selling worthless options before those days come.
I think they will turn the corner this year to profitable. They have spent like drunken sailors building the Project Phoenix processing facility and buying a bunch of other RE businesses. 2014 looks to be the point where it finally is a regular operation, and not a giant development project. They set some ambitious targets for the operation at Mt Pass. If they get close they will turn to profitable. I like a lot of the other operations also, and think there are reasons to expect that the different operations will also see better results.
In Q2-2013 they had a cost basis of $35 per kg. They dropped that to about $25 per kg in Q3-2013. We will learn the cost basis for Q4 in March. Likely it is a slight bit lower. The largest cost reductions are from the chemical cost reduction with Chlor-Alkali operations, which are not yet in place. They also can reduce the cost per kg with the distribution of fixed costs over a higher production level. The final cracking stage lets them run at the target 19,000 mt per year rate, which could trim $3-$5 of the cost per kg.
But they have also said that they won't produce if they don't have customer demand. And customer demand depends on validation of the product by the customers, which will depend on the process being finalized ... a bit of a catch-22.
The target is a cost basis of $7 per kg ($7000 per mt). That is a net cost of $130 million a 19,000 mt per year. They need to hit that cost target and develop customers for the products at a decent profit margin.
The bull case is that they turn the corner to profitable. Then they grow from there.