Realignment in the Tungsten Market
Approximately 82% of global tungsten production takes place in China. Thus, the People’s Republic effectively dominates the market. However, this is set to change in the future, as Almonty Industries is emerging as the leading Western producer of tungsten through its mega-project in Asia and plans a significant expansion of its capacity, which would diversify the trade of the metal.
To break free from dependence on Asian supply chains, Almonty Industries is strengthening its global project pipeline. The Canadian company’s flagship project is the Sangdong Mine in South Korea. An operational milestone was recently reached there with the mine achieving production status. The plan is now to process 640,000 tons of ore annually. However, this is only part of the plan, as the second phase of expansion, which will significantly increase production, is scheduled to be completed by the end of 2027. At full capacity, the company could therefore meet up to 40% of total global demand outside the People’s Republic in the future, making South Korea a fully integrated hub for this critical material. This project is supported by the long-established, producing Panasqueira mine in Portugal, as well as a new, promising mining project in the US, which is scheduled to begin operations in the second half of this year.
Margins and Explosive Earnings Growth
Thanks to the favorable market conditions, this operational setup is now generating tremendous leverage. The Sangdong mine was designed to be so cost-efficient that it would remain profitable even if prices were to theoretically drop to USD 300 per MTU. If prices remain high, profits will flow in the future. Starting in 2028, management is targeting spectacular net margins of 60% based on expected annual revenue of approximately CAD 1 billion. According to expert forecasts, operating earnings are also poised for a significant revaluation and are expected to rise to as much as CAD 844 million by 2027. This jump in profits will rapidly lower the stock’s fundamental valuation. The expected EV/EBITDA ratio is likely to fall from 24.8 in 2026 to a low of 10.1 the following year. Market participants therefore view the stock’s recent correction of around 35%, following a months-long rally, as a brief and sharp consolidation within the long-term uptrend.
Analyst Consensus – Price Targets with Massive Upside
Analysts agree on Almonty’s enormous potential. The current price level is far from reflecting the true potential of this commodities player. Especially following the recent price consolidation, market observers see an excellent risk-reward ratio. GBC analysts have drastically raised the price target from CAD 9 to CAD 28.60, equivalent to approximately EUR 17.71, in response to the changed market environment. This revaluation is primarily based on an adjusted cash flow model that takes into account the rapid ramp-up of production in South Korea as well as the structural shortage caused by China’s export restrictions.
The calculations are even based on a conservative, long-term tungsten price of just USD 1,500 per MTU. Cantor Fitzgerald is even more bullish, setting a target of CAD 36. The experts are deliberately assigning a valuation premium to the stock, as the company enjoys an absolutely exceptional position as an essential supplier outside China’s sphere of influence. In times of global trade wars, this geopolitical reliability is viewed as a tangible competitive advantage. Bank of America also sets a strong price target of USD 20. The professionals’ verdict is clear. The fundamental gap between the current market value and the intrinsic value is huge; massive upside appears inevitable. If these targets are met, price gains of well over 80% in some cases are on the horizon.
Almonty Industries thus offers investors a virtually unprecedented opportunity to profit from the geopolitically driven tungsten supercycle. The recent price correction has opened a highly attractive entry window for risk-aware investors. As a key Western producer, the company is ideally positioned to address the structural supply deficit outside of China in the long term. Coupled with rapidly rising cash flows, massive profit margins, and high strategic urgency, the risk-reward ratio is outstanding, according to several analysts. The recent pullback to CAD 19 could represent an attractive buying opportunity for long-term investors.
Conflict of interest
Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as “Relevant Persons”) may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a “Transaction”). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.
In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.
For this reason, there is a concrete conflict of interest.
The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.
Risk notice
Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and the like on news.financial. These contents are exclusively for the information of the readers and do not represent any call to action or recommendations, neither explicitly nor implicitly they are to be understood as an assurance of possible price developments. The contents do not replace individual expert investment advice and do not constitute an offer to sell the discussed share(s) or other financial instruments, nor an invitation to buy or sell such.
The content is expressly not a financial analysis, but a journalistic or advertising text. Readers or users who make investment decisions or carry out transactions on the basis of the information provided here do so entirely at their own risk. No contractual relationship is established between Apaton Finance GmbH and its readers or the users of its offers, as our information only refers to the company and not to the investment decision of the reader or user.
The acquisition of financial instruments involves high risks, which can lead to the total loss of the invested capital. The information published by Apaton Finance GmbH and its authors is based on careful research. Nevertheless, no liability is assumed for financial losses or a content-related guarantee for the topicality, correctness, appropriateness and completeness of the content provided here. Please also note our Terms of use.
Stockhouse does not provide investment advice or recommendations. All investment decisions should be made based on your own research and consultation with a registered investment professional. The issuer is solely responsible for the accuracy of the information contained herein. For full disclaimer information, please click here.