Appreciate the detailed breakdown as always, Mith.
While the short-seller thesis and the general sentiment across the critical materials sector certainly play a role, I think there is an elephant in the room that shouldn’t be overlooked: the mechanics of the S-3/A filing and the active ATM facility with Virtu Americas.
Looking closely at the PR itself, it doesn't announce new commercial contracts or immediate incremental cash flow but it essentially restores the status quo prior to the recent BIS export restrictions, allowing the company to export up to $100M in black mass under an interim license. That is certainly positive operational news to avoid an inventory bottleneck at Reno, but it is a regulatory waiver rather than new signed customer orders.
More importantly, look at the order flow: just three minutes into the regular session, volume had already surpassed 13 million shares, ending the day above 21 million while the price couldn't hold even $2.40. That level of instantaneous liquidity being fully absorbed points directly to massive supply hitting the tape. For a company managing cash burn and facing ongoing CapEx needs, utilizing an active ATM facility into a high-volume, news-driven liquidity event is standard corporate finance playbook.
Shorts may work momentum stocks down, but substantial dilution into retail volume often caps the upside before momentum can even build. Don't you think the immediate capital-raising necessity through the ATM had a much more direct impact on that price action than seasonal restocking or algo glitches?
Curious to hear your take on how much of the ATM capacity you think was tapped during that session.
Let us start with the S-3/A: They did have another shelf filed, an S-3 ASR, which was an automated filing allowing them do offerings without prospectus amendment, (I do not remember the exact term, but it is something like well-seasoned filer) and required a few things, including a public float above $700 million. When they filed the 10-K, due to the share price, they no longer met those well-seasoned requirements, and the ASR became invalid, so they had to file a new S-3 to replace it. In fact I remember when they filed a standard S-3, then retracted it to only file the S-3 ASR the next day.
So really, it is not a new offering, just a replacement that, due to the share price, they were no longer able to utilize. But since the new one is a standard S-3 with just an amendment included, they would have to wait for the notice of effectiveness. It would not have been available to them when that price spike happened. They do have other ways to dilute, just not with the one you are talking about.
And the almost supernatural amount of shares showing up for a critical material stock when it is rallying is not limited just to ABAT, as it is something people are watching and commenting on sector-wide. Me personally, I just default to it being Jane Street and go have a cup of coffee.
Next, and maybe I was not clear on this nowhere did I say that this $100 million was a new contract. In fact, the terminology I used was to show it was an allowance, not a sale, and that is what the algos latched on, as the wording across the web made it sound like a sale or contract. I play a ton of momentum stocks and that is the exact type of headline that I look for when I do a 5-10 minute play for well 5-10% in gains.
As for the allowance, this is something that I said was going to happen the second I read the exceptions allowed in the new rule, and is something I warned against in another piece where allowances were just rubber-stamped and the consequences of that.
But let us talk about their dilution, and I have said it is something people are going to be hit with sooner rather than later as we go into 2027. One of the things in jeopardy right now is the $40 million 48C tax credit for the second recycling facility. They have until March 2028 to bring something online, not fully functional, but some kind of operations online, or they lose it. So they are going to have to start spending more to make some kind of operations at a second location happen by March 2028.
As for battery grade at TRIC, unless the allowances are dependent on plans submitted by ABAT to mediate their dependency on exports for their black mass, then really they will most likely continue to let the recycling vertical grow organically and add new systems as the throughput allows it. If they do have to get going on battery grade, it still will not be a massive endeavour like Phase 1, rather staged rollouts with lithium first.
As for Tonopah, that one is on the back burner unless they are able to pull the 5ktpa demonstration plant back out of the full NEPA review and shoot for the original EA with a FONSI that the Department of Energy decided was all that was required. If that happens, then they are going to be needing capital a lot sooner than what is listed in the schedule for the FAST-41.
Without that, Tonopah spending is mostly a slow trickle where they are going to spend more on R&D than anything related to that project.
Let us start with the S-3/A: They did have another shelf filed, an S-3 ASR, which was an automated filing allowing them do offerings without prospectus amendment. (I do not remember the exact term, but it is something like well-seasoned filer) and required a few things, including a public float above $700 million. When they filed the 10-K, due to the share price, they no longer met those well-seasoned requirements, and the ASR became invalid, so they had to file a new S-3 to replace it. In fact I remember when they filed a standard S-3, then retracted it to only file the S-3 ASR the next day.
So really, it is not a new offering, just a replacement that, due to the share price, they were no longer able to utilize. But since the new one is a standard S-3 with just an amendment included, they would have to wait for the notice of effectiveness. It would not have been available to them when that price spike happened. They do have other ways to dilute, just not with the one you are talking about.
And the almost supernatural amount of shares showing up for a critical material stock when it is rallying is not limited just to ABAT, as it is something people are watching and commenting on sector-wide. Me personally, I just default to it being Jane Street and go have a cup of coffee.
Next, and maybe I was not clear on this nowhere did I say that this $100 million was a new contract. In fact, the terminology I used was to show it was an allowance, not a sale, and that is what the algos latched on, as the wording across the web made it sound like a sale or contract. I play a ton of momentum stocks and that is the exact type of headline that I look for when I do a 5-10 minute play for well 5-10% in gains.
As for the allowance, this is something that I said was going to happen the second I read the exceptions allowed in the new rule, and is something I warned against in another piece where allowances were just rubber-stamped and the consequences of that.
But let us talk about their dilution, and I have said it is something people are going to be hit with sooner rather than later as we go into 2027. One of the things in jeopardy right now is the $40 million 48C tax credit for the second recycling facility. They have until March 2028 to bring something online, not fully functional, but some kind of operations online, or they lose it. So they are going to have to start spending more to make some kind of operations at a second location happen by March 2028.
As for battery grade at TRIC, unless the allowances are dependent on plans submitted by ABAT to mediate their dependency on exports for their black mass, then really they will most likely continue to let the recycling vertical grow organically and add new systems as the throughput allows it. If they do have to get going on battery grade, it still will not be a massive endeavour like Phase 1, rather staged rollouts with lithium first.
As for Tonopah, that one is on the back burner unless they are able to pull the 5ktpa demonstration plant back out of the full NEPA review and shoot for the original EA with a FONSI that the Department of Energy decided was all that was required. If that happens, then they are going to be needing capital a lot sooner than what is listed in the schedule for the FAST-41.
Without that, Tonopah spending is mostly a slow trickle where they are going to spend more on R&D than anything related to that project.
Appreciate the detailed breakdown as always, Mith.
While the short-seller thesis and the general sentiment across the critical materials sector certainly play a role, I think there is an elephant in the room that shouldn’t be overlooked: the mechanics of the S-3/A filing and the active ATM facility with Virtu Americas.
Looking closely at the PR itself, it doesn't announce new commercial contracts or immediate incremental cash flow but it essentially restores the status quo prior to the recent BIS export restrictions, allowing the company to export up to $100M in black mass under an interim license. That is certainly positive operational news to avoid an inventory bottleneck at Reno, but it is a regulatory waiver rather than new signed customer orders.
More importantly, look at the order flow: just three minutes into the regular session, volume had already surpassed 13 million shares, ending the day above 21 million while the price couldn't hold even $2.40. That level of instantaneous liquidity being fully absorbed points directly to massive supply hitting the tape. For a company managing cash burn and facing ongoing CapEx needs, utilizing an active ATM facility into a high-volume, news-driven liquidity event is standard corporate finance playbook.
Shorts may work momentum stocks down, but substantial dilution into retail volume often caps the upside before momentum can even build. Don't you think the immediate capital-raising necessity through the ATM had a much more direct impact on that price action than seasonal restocking or algo glitches?
Curious to hear your take on how much of the ATM capacity you think was tapped during that session.
Let us start with the S-3/A: They did have another shelf filed, an S-3 ASR, which was an automated filing allowing them do offerings without prospectus amendment, (I do not remember the exact term, but it is something like well-seasoned filer) and required a few things, including a public float above $700 million. When they filed the 10-K, due to the share price, they no longer met those well-seasoned requirements, and the ASR became invalid, so they had to file a new S-3 to replace it. In fact I remember when they filed a standard S-3, then retracted it to only file the S-3 ASR the next day.
So really, it is not a new offering, just a replacement that, due to the share price, they were no longer able to utilize. But since the new one is a standard S-3 with just an amendment included, they would have to wait for the notice of effectiveness. It would not have been available to them when that price spike happened. They do have other ways to dilute, just not with the one you are talking about.
And the almost supernatural amount of shares showing up for a critical material stock when it is rallying is not limited just to ABAT, as it is something people are watching and commenting on sector-wide. Me personally, I just default to it being Jane Street and go have a cup of coffee.
Next, and maybe I was not clear on this nowhere did I say that this $100 million was a new contract. In fact, the terminology I used was to show it was an allowance, not a sale, and that is what the algos latched on, as the wording across the web made it sound like a sale or contract. I play a ton of momentum stocks and that is the exact type of headline that I look for when I do a 5-10 minute play for well 5-10% in gains.
As for the allowance, this is something that I said was going to happen the second I read the exceptions allowed in the new rule, and is something I warned against in another piece where allowances were just rubber-stamped and the consequences of that.
But let us talk about their dilution, and I have said it is something people are going to be hit with sooner rather than later as we go into 2027. One of the things in jeopardy right now is the $40 million 48C tax credit for the second recycling facility. They have until March 2028 to bring something online, not fully functional, but some kind of operations online, or they lose it. So they are going to have to start spending more to make some kind of operations at a second location happen by March 2028.
As for battery grade at TRIC, unless the allowances are dependent on plans submitted by ABAT to mediate their dependency on exports for their black mass, then really they will most likely continue to let the recycling vertical grow organically and add new systems as the throughput allows it. If they do have to get going on battery grade, it still will not be a massive endeavour like Phase 1, rather staged rollouts with lithium first.
As for Tonopah, that one is on the back burner unless they are able to pull the 5ktpa demonstration plant back out of the full NEPA review and shoot for the original EA with a FONSI that the Department of Energy decided was all that was required. If that happens, then they are going to be needing capital a lot sooner than what is listed in the schedule for the FAST-41.
Without that, Tonopah spending is mostly a slow trickle where they are going to spend more on R&D than anything related to that project.
Let us start with the S-3/A: They did have another shelf filed, an S-3 ASR, which was an automated filing allowing them do offerings without prospectus amendment. (I do not remember the exact term, but it is something like well-seasoned filer) and required a few things, including a public float above $700 million. When they filed the 10-K, due to the share price, they no longer met those well-seasoned requirements, and the ASR became invalid, so they had to file a new S-3 to replace it. In fact I remember when they filed a standard S-3, then retracted it to only file the S-3 ASR the next day.
So really, it is not a new offering, just a replacement that, due to the share price, they were no longer able to utilize. But since the new one is a standard S-3 with just an amendment included, they would have to wait for the notice of effectiveness. It would not have been available to them when that price spike happened. They do have other ways to dilute, just not with the one you are talking about.
And the almost supernatural amount of shares showing up for a critical material stock when it is rallying is not limited just to ABAT, as it is something people are watching and commenting on sector-wide. Me personally, I just default to it being Jane Street and go have a cup of coffee.
Next, and maybe I was not clear on this nowhere did I say that this $100 million was a new contract. In fact, the terminology I used was to show it was an allowance, not a sale, and that is what the algos latched on, as the wording across the web made it sound like a sale or contract. I play a ton of momentum stocks and that is the exact type of headline that I look for when I do a 5-10 minute play for well 5-10% in gains.
As for the allowance, this is something that I said was going to happen the second I read the exceptions allowed in the new rule, and is something I warned against in another piece where allowances were just rubber-stamped and the consequences of that.
But let us talk about their dilution, and I have said it is something people are going to be hit with sooner rather than later as we go into 2027. One of the things in jeopardy right now is the $40 million 48C tax credit for the second recycling facility. They have until March 2028 to bring something online, not fully functional, but some kind of operations online, or they lose it. So they are going to have to start spending more to make some kind of operations at a second location happen by March 2028.
As for battery grade at TRIC, unless the allowances are dependent on plans submitted by ABAT to mediate their dependency on exports for their black mass, then really they will most likely continue to let the recycling vertical grow organically and add new systems as the throughput allows it. If they do have to get going on battery grade, it still will not be a massive endeavour like Phase 1, rather staged rollouts with lithium first.
As for Tonopah, that one is on the back burner unless they are able to pull the 5ktpa demonstration plant back out of the full NEPA review and shoot for the original EA with a FONSI that the Department of Energy decided was all that was required. If that happens, then they are going to be needing capital a lot sooner than what is listed in the schedule for the FAST-41.
Without that, Tonopah spending is mostly a slow trickle where they are going to spend more on R&D than anything related to that project.