Neometals director sells down 1m shares, but says the stock is under-valued
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A director of lithium producer Neometals pocketed more than $400,000 after selling a bunch of shares.
Non-executive director David Reed sold 1 million shares on-market in late January at an average price of around 41c per share.
Neometals (ASX:NMT) shares were down 4.2 per cent on Tuesday at around 35c.
“It was a million shares. I’ve got 60 million so it’s nothing in terms of my overall holding, I just needed some working capital,” Mr Reed told Stockhead.
Shares have been steadily gaining ground since late May last year, when they were trading at a low of 25c. The company hit a 52-week peak of 51c in early November.
Neometals and joint venture partners Mineral Resources (ASX:MIN) and Jiangxi Ganfeng Lithium, one of China’s largest lithium producers, have started producing from the Mount Marion project in Western Australia.
Mr Reed believes the company is undervalued considering it is already in production and way ahead of its peers.
“We’re actually producing spodumene and exporting it, so we’re putting money in the bank,” he said.
“All these other aspiring producers have yet to get into production. So we’re a long way ahead of those that are still building their plants. I think the company is grossly undervalued.”
Spodumene is a source of lithium and occurs in lithium-rich granite pegmatites.
Neometals had $39.8 million cash in the bank at the end of the December quarter.