The Canadian cobalt stocks we’ve dug up are poised to benefit from an increase in cobalt demand
SmallCapPower | December 31, 2018: RBC Capital Markets estimates that globally, Electric Vehicle (EV) sales are projected to increase 12-times by 2025 from 3M units sold in 2016, to 35M units sold in 2025. Major catalysts driving this 12-fold increase include concerns about climate change and government regulations aimed at phasing out internal combustion engine (ICE) vehicles to help reduce CO2 emissions. Cobalt is the primary metal in an EV battery, and a typical EV battery has between 4-14 kg of cobalt (Source: Cobalt 27 Investor Deck). Thus, a 12-fold increase in EV sales could translate into a four-fold increase in cobalt demand. Today, we have identified three Canadian cobalt stocks that could potentially benefit from a rise in cobalt demand.
*Share prices as at close December 24, 2018
Canada Cobalt Works Inc. (TSXV:CCW) – $0.45
Canada Cobalt Works is drilling three prospective properties in Ontario for cobalt: the Castle Mine, Violet Mine, and Beaver Mine. Each property is located in northern Ontario’s Cobalt camp near the town of Cobalt, Ontario, Canada’s most prolific cobalt district. The Company has a proprietary hydrometallurgical process known as Re-2OX for the creation of technical grade cobalt sulphate as well as nickel-manganese-cobalt (NMC) formulations. Canada Cobalt Works is strategically positioned to become a vertically-integrated North American leader in cobalt from extraction to recovery.
- Market Cap: $33.8 million
- 1 Month Total Return: – 19%
- YTD Total Return: +36.6%
- Average Daily Volume – last 30 days: 226,445
- Average Daily Volume – last 12 month: 336,967
Cobalt 27 Capital Corp. (TSXV: KBLT) – $3.68
Cobalt 27 Capital is a pure play cobalt investment vehicle with royalty interests in 11 exploration-stage properties containing cobalt in Canada, Australia, and Papa New Guinea. Included is the Voisey’s Bay Newfoundland Cobalt mine, which is targeting to begin production in 2021, with 800 metric tons in annual cobalt production capacity, with full scale production of 2,600 metric tons expected by 2025. Other notable royalties the Company has includes the Ramu Mine in Papa New Guinea, Dumont Project, Quebec, and Flemington Nickel Cobalt Project in Australia.
- Market Cap: $312.2 million
- 1 Month Total Return: – 27.1%
- YTD Total Return: – 70.1%
- Average Daily Volume – last 30 days: 284,486
- Average Daily Volume – last 12 months: 196,916
First Energy Metals Ltd. (TSXV: FE) – $0.20
First Energy Metals Limited is an early-stage exploration company that explores and develops mineral properties. Its early-stage exploration properties include the Kaslo Silver property that covers an area of approximately 4,000 hectares located in southern British Columbia; the Phyllis Cobalt property that consists of 112 mineral claim units covering an area of ~1,750 hectares located in Kenora Mining District, Ontario; and the Russel Graphite property, which comprises 30 mineral claims covering an area of approximately 1,798.06 hectares located in the Gatineau area of Quebec.
- Market Cap: $3.5 million
- 1 Month Total Return: – 25%
- YTD Total Return: – 8%
- Average Daily Volume – last 30 days: 9,270
- Average Daily Volume – last 12 months: 26,001
Ubika Research/SmallCapPower has received compensation from Canada Cobalt Works to provide analyst research coverage. For full disclosure please visit here >>
Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.
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