Yesterday, NIA announced Western Potash (TSX: WPX) at $0.135 as its #1 stock suggestion for 2017. WPX finished yesterday up 33.33% to $0.18 per share on very strong volume of 2,364,270. This could be our last chance to enter below $0.20 per share. WPX raised $80.7 million in August of last year in two private placement transactions at $0.3358 per share!
In NIA’s opinion, WPX is likely to very quickly return to last year’s private placement price of $0.3358 per share – with North American Potash Inventories declining 49% over the past three months and potash prices likely to soar in 2017!
WPX has CAD$74.78 million or $0.16 per share in cash and no debt! At WPX‘s current price of $0.18 per share its 100% owned 87,500 acre Milestone Potash Project in Saskatchewan, Canada, is being valued at only CAD$9.34 million when K+S AG (KPLUY) paid CAD$434 million in 2010 to acquire Potash One, a potash exploration company that owned the project directly adjacent to WPX‘s Milestone Potash Project!
K+S AG is currently constructing a mine at its adjacent Legacy Potash Project, which is set to commence potash production in 2017! Last year, Potash Corp of Saskatchewan (POT) offered CAD$10.9 billion to acquire K+S AG, specifically for the purpose of acquiring the Legacy Potash Project – but the deal was rejected by K+S AG shareholders who considered the offer to be too low!
WPX has the backing of China Development Bank (CDB), the world’s largest development finance institution with approximately USD$2 trillion in assets. CDB entered into a Memorandum of Understanding for Strategic Cooperation with WPX in October of last year and the signing ceremony was attended by CDB Chairman Hu Huaibang!