Sirius Minerals plc (lon:sxx)
Is Sirius Minerals plc Too Long Term For Private Investors?

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Sirius Minerals plc Share Price
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Title: Is Sirius Minerals plc Too Long Term For Private Investors?
Company: SXX - Sirius Minerals plc
Share Price Then: 33.16p
Author: Ian Smith
Date: Wed 28 Jun 2017
Comments: Sirius Minerals are an early stage mining company looking to mine Polyhalite (fertilizer) in the North Yorkshire Moors.

The current schedule has the first production occuring at the end of 2021 and full production starting mid 2024. There may be uncertainity that this schedule will be met as much of the construction work will be debt funded rather then be new share issues.

Inevitably there are those who think that it is a great opportunity and others who think that it will never be completed and even if it is there is no demand for the product.

As the company is currently a FTSE 250 company there is some price stabilty, but for a private investor there is no great reason to believe in a share price increase (currently it has reached 48p) before production starts and plenty of reason to believe that it may drop.

If you are quite young you may be able to wait this long, assuming that the company actually gets to the expected production level, but if you need to sell over the next 3-4 years you could be taking a very large loss. In other words it could be seen as a pseudo "value trap".

Even if the project becomes a success you still need to compare it the growth available from investing your funds elsewhere during those years.
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