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Exactly, mac.
Even if the share price goes lower, who cares. It's all superficial. Most of us believe in this for the long term. The true value of Tronox is well above $3.00 per share today, and even higher. The posted valuation letter says it all.
But nothing will happen until there is more certainty. This will be in July.
So, we all just have to sit back and be amused by the MM action.
Or, pick up more shares while you still have the chance at these levels!
Good weekend to all.
Newtech, just to add to my other comment to put this into perspective:
If you assume the annual capacity of Tronox that is exposed to the contribution of price increases, this would be roughly 380,000 metric tonnes, which excludes Savannah and Uerdingen.
Hamilton = 230,000mt per year
Botlek = 90,000mt per year
Tiwest contribution = 50% of 120,000mt per year = 60,000mt
Total = 380,000mt per year, maybe a bit less.
So, for every $100 per metric tonne increase, the contribution to the revenue line over a year would be $38,000,000, much of which goes to the bottom line.
However, price movement since the first quarter of this year and into the end of this year alone will far exceed $200 per tonne! I think price increases on average this year alone will easily move up at least $300 per tonne over the year. In some markets well over $500 per tonne.
It is also important to realize that the actual implemented price increases are usually less than the announced amounts. But in tight markets like these, the announcements and percentage of successs on implementation become higher.
But to your point, a $54 million market cap for Tronox is just silly.
Newtech, these increases only give one part of the view as to what is really going on. I have no words to express to you how tight the global TiO2 markets are today. Given the outlook, this tightness and pricing power should remain with TiO2 producers well into next year.
But, what is amazing to me is that there appears to be nothing that will rocket the Tronox share price to the levels that it should be at today. I have never in my life seen anything like this.
A market cap of $54 million is absurd!
The shares and pricing are obviously in the hands of those who want to hold it at these levels for some reason. I have to believe the total number of shareholders is now relatively small, and those that own have no intention of letting go. But why hold the price down?????
The rocket is on the launch pad, so would somebody please light the big fuse!
Yes, we have all remained diligent on our positions in Tronox for very founded reasons.
After so many of us have waited so many months for this to evolve, I think we are only a couple of months away from getting news that will kick Tronox to much higher levels.
The fundamentals in the TiO2 business are better than any I have seen in decades.
mac, I think somebody got nervous about the market on the B shares and decided to sell thinking the price would go below a dollar. Short term thinking.
To much fear in the market this week. So, strange things happen and the MM's can take advantage of this to pick up shares and create a downward trend perception. When news breaks, nothing will hold Tronox back.
So remember, the fundamentals are sound for Tronox. Despite any short term volatility, Tronox is going higher, as we have all thought for quite some time.
Hold on and just let the storm pass.
Fear is our friend! Have a good weekend jax!
mac, I'm only buying during this chaos.
A few weeks from now, all of this fear will pass.
uhlmant, this is all absolutely correct. Simmons essentially has and always has had control of most of the shares.
The problem with trading Kronos has always been share liquidity. The share price is essentially controlled by one person.
Another reason that Tronox is a better play on TiO2.
Still, Kronos is a good relative indicator of the direction Tronox should be moving.
No, Cristal Global is now privately owned by Saudi and Middle East investors. Cristal Arabia purchased Millennium from Lyondell in May, 2007, and then renamed the company Cristal Global. At that time, Cristal Arabia was the 9th largest producer in the world purchasing Millennium, the No. 2 player in the world.
Tronox remains that best leverage play on the surging TiO2 markets today. I am just perplexed why Tronox shares have not yet bolted out of the barn, especially with titanium dioxide prices now surging to levels not seen in over 20 years!
pinky, some of the most significant TiO2 producers in the world are as follows:
DuPont (Number 1)
Cristal Global (Number 2)
Tronox (Number 3)
Huntsman Tioxide
Kronos
Ishihara (Japan/Singapore)
Tayca (Japan)
Sakai (Japan)
KMML - Kerala Minerals and Metals (India)
Kemira
Sachleben
Krymsky Titan (Ukraine)
Cinkarna (Slovenia)
Zachem Police (Poland)
Precheza (Czech Republic)
Cosmo (Korea)
TTP (India)
Kilburn (India)
Dongjia (China)
Pangang Group (China)
Lomon (China)
Billion (China)
Other China Producers (more than 50 of them!)
But, just concentrate on the first 6 on the list, as they are the significant global players.
Hope this helps.
Interesting, Kronos (KRO) share price, a pure play on TiO2, surged the past couple of days on high volume. Then the NYSE approached them in the regard.
Kronos Worldwide, Inc. (NYSE: KRO), states that its policy is not to comment on unusual market activity
In view of the unusual market activity in the stock of Kronos Worldwide, Inc. (NYSE: KRO), the NYSE has contacted the company in accordance with its usual practice; the company stated that its policy is not to comment on unusual market activity.
newtech, your comments about the comparison of Tronox to Kronos are absolutely correct.
The TiO2 markets continue to get tighter and tighter with prices moving up to levels not seen since the previous 1988 / 1989 supply crisis. Kronos share price is indicative of this. Recent comments from the DuPont earnings report also reflect this.
Why Tronox shares have not broken out further continues to amaze me. However, as all of us on this board know, it is just a matter of time.
When news of the restructuring plan finally breaks, we should see the shares here rocket higher very quickly.
Perhaps we will have to endure this trading range until the July to September timeframe.
Excellent detail, PostCog, thanks for this.
Madclown, I believe Tronox is now completely disassociated with this asset in Germany and they walked away from it. It is now under the receivership of the German government who is operating it, and who had tried to sell it months earlier before the markets started to improve so much. Now they can take their time to seek interested buyers, but I still don't think anyone would want to purchase this asset at any reasonable price level.
It is no longer nor will it be a part of the future Tronox asset base, so I don't think they (Tronox) have any reporting responsibility on this plant any longer.
Tronox tried to sell this facility over prior years, however, there were no takers, as it is a high cost sulphate technology asset.
Being as it is now held and operated by Germany, I also think that it can only be sold to a German entity, as least as the first sale. A bit strange, however, it is all about job retention.
For purposes of our concern about future Tronox assets and value to the share price, we need to be more concerned about the performance of Hamilton (USA), Kwinana (Australia) and Botlek (Netherlands), which will make up the new Tronox TiO2 asset base. Savannah is already shut down for all intensive purposes, however, I think the acid plant is still running.
Thanks for this pinky. Let's hope there is a roll-off effect on the Tronox share price today.
Titanium dioxide prices continue to soar as supplies become scarce, especially in the emerging markets. The more mature markets should soon follow (Europe and US).
Should be an interesting trading day for Tronox!
Newtech, I'm off to the office for some meetings, however, I will give you some more specific feedback to your question when I get back this evening.
Good question!
Great work, uhlmant.
This attention to detail is why this board is so effective.
This only promotes more confidence that all of us who are longs really have our facts correct and our due diligence is deeply in order.
My total compliments to you.
Thanks, pennypalooza. It's important that we all stay educated on the facts.
I just can't understand how the bid/ask can be $1.23/$1.24 and trades keep going through at $1.20.
Much like you were talking about.
So, I guess we have enough altitude now to be on the radar screen.
In any event, we need to be very pleased with where we were and how far we have come this week, regardless.
Thanks for this, jaxstraw. It all makes sense now. Lightning fast automated trade. Just what we need.
Wonder what it takes to gid rid of them and make them go play in somebody elses sandbox.
Yes, these two have been driving me crazy trying to figure out what they are doing. I thought they would have been washed out yesterday, but here they are again. They obviously have some pretty sophisticated computers working in the background.
Look at that daily chart. He is obviously baiting whoever will bail out in the afternoon decay.
Tracker, I think you may be confused between titanium metals and titanium dioxide, which is what Tronox produces.
These are two different markets. Of course, titanium metal goes into aircraft construction and engines. Not TiO2.
As for TiO2 producers in the US, there is sigificant capacity that will not go away.
Most of DuPont's capacity is in North America and they are No. 1 in the world. Cristal, Kronos/Tioxide, Tronox all have their largest plants in the States also. But, the growth is in Asia.
Cristal global has started a position in titanium metals, I believe, but other producers are more focused on TiO2 production.
So, titanium metal and titanium dioxide are two different animals. If you are investing in Tronox for exposure to titanium metal, you made the wrong investment.
Demand in Asia, Middle East, Africa and Latin America is off the chart! Not just Asia.
Europe and North America are recovering, but nowhere near those other markets.
Tracker, the Chinese and Ukranians are still out there in the market in force. However, the quality of their grades can only be employed in lower end market segments. Examples would be low-end decorative coatings and low-end powder coatings, etc.
The Chinese continue to bring on significant capacity, however, with China's economy being so strong now, much of this is being consumed in China and not being exported. The goverment stimulus in China mostly went into fixed infrastructure and housing, putting huge demand on coatings, and therefore, TiO2.
Exports of TiO2 out of China still are not back up to their peak levels of 2006. Also, much (more than half) of the capacity in China is Anatase on not rutile grade TiO2.
Even though the capacity in China is coming on quickly, the markets are absorbing this since they can put it into low-end formulations and save costs. Chinese grades sell at hundreds of dollars a tonne discount to premium chloride grades like those produced by Tronox. But even the Chinese are moving prices up now and are struggling to meet their supply commitments.
Also, the high end market segments, such as industrial coil and high end marine coatins, can coatings, auto coatings, etc. all require high performing TiO2 grades. The demand for these segments is increasing along with the low-end segment demand.
Here is the big difference: The Chinese are expanding, the high-end chloride producers are not because the profitability of the industry has been so poor for past years. In fact, much capacity has been taken off-line in the past 18 months, mostly the higher cost plants.
Now, we have a supply crisis for the high quality grades, and therefore prices are rocketing to levels not seen in many years.....if you can find the supply.
Thanks for the clarification, tracker. Appreciate it.
But I don't think the company would be selling shares now, especially because TiO2 prices are surging around the globe. I think the markets are taking care of the cash flow issues now.
But, your thoughts and insight are important. That's what makes this board better than most!
Thanks for your comments, kelper.
Nice to have you on the board.
There are about 5 or 6 of us who have been here for a long time, as we have total confidence in our due diligence and where Tronox is headed.
It has all finally started to evolve this week.
Mac, just shook my magic 8 ball to ask if our Tronox investment is still sound.
It gave the reply: "It is decidedly so."
So, I think we are still ok.
Thanks for the heads up, PennyP. Much appreciated.
The current CEO, Dennis Wanless, has little if any shares. He was put into this position to reorganize after Tom Adams was kicked out by the Board. Even the Board held very little shares before the bankruptcy. Tom Adams only had around 255,000 before he got the boot.
If you think the CEO is dumping shares to raise cash, I don't think he has any to release. He is making all his money on the structure of his contract, which is short-term.
And, he has no intention of hanging around after the re-emergence from bankruptcy.
I think this is why it is taking longer for more news. For Tronox to re-emerge, they need a new CEO, a Board and a new management team. All this has to be put in place. They would be crazy to put John Romano in charge, but he is the last guy standing right now. If he is put in at the top, that's when you know it's time to unload your shares.
Still taking on altitude, Everett.
Not there yet.
Through all of AUTO's MM games in prior weeks, he is probably now loaded up with shares and now he has jumped on the horse to lead the move up to put bigger money in the bank.
Phase I - load up on shares with MM manipulation.
Phase II- When the market moves the stock more than the MM's can control, capitulate and participate in the rocket move upwards.
Brilliant!
Also, if and when Galen does decide to sell his shares, I would think it could possibly be a pre-arranged sale with a second party instead of just dumping them on the open market. Johnathan is too smart to just dump into the open market with such low float.
But, I don't think we have to worry about that any time soon.
Madclown, you are correct on this one. I also believe Gallen's shares are locked up and he either can't sell them or doesn't want to sell them at this stage.
Bond at $120.75 today.
You could be right. It would be nice to see this push to the $1.50 range before any significant consolidation and then the next push upwards.
In any event, we need to be happy about what we saw today. Great action.
The other thing I find amazing is how the share price can hold a 10 cent spread between the A and B share price. This has baffled me over the past couple of years, but the wide differential can hold for considerable periods of time.
The B shares must be transparent to some.
Yes, now well over a combined volume of 3.4MM shares on the A's and B's.
I'm not so concerned about sell volume outpacing buy volume.
The main point is that the price is up huge today. For those that got in at a few cents per share, you would expect some big volume on the profit taking side.
However, for the rest of us, the glass is still only half full. We have a long way to go to the upside.
Just hang on and enjoy the ride. We can expect some ups and downs in the days ahead. I wouldn't be surprised if we now move sideways for awhile until some other news breaks. We will probably test support to the low side.
We need to hold support at $1.00, however, then the future looks great!
This is easy to understand since we are all such a wonderful group of people! And, we don't give you all those other problems like the other family does!