Below is the text of a 3 minute "stock slam" I did on Sylvania Platinum (LON:SLP) at a CFA meet up a few months ago. 
I own it.
Just thought I would share it because other people seem to be interested in this stock. Do Your Own Research obviously. Also, the valuation multiples, price of Lonmin are out of date, but doesn't effect the basic story...


This evening I’m going to pitch you a really contrarian idea. It’s a company that operates in a really hated sector. But although it’s on 7x earnings, paying a dividend, net cash and buying back shares – it’s not a value stock. It’s actually a really good “story” stock. And you can find good stories in the most unexpected places.
It’s a platinum miner in South Africa.
I think I should start by helping you understand why the platinum miners as a sector have been terrible investments over the last decade. Take Lonmin, which in 2008 received a $10bn approach from Xstrata. That’s £33 per share. Ten years later it’s worth 40p a share. And things are actually worse than that 98% share share price decline…because Lonmin did 3 rights issues in 6 years, the most recent one at a 94% discount to the then share price. A bit like banks, if you’d backed the rights issues, you’d have lost more than 100% of your initial investment.
That’s a cautionary tale.
But hopefully I can convince you that Sylvania is a good story, when you understand platinum a bit better.
Most of the world’s platinum is dug out of the ground in South Africa. And at the current platinum price around 4/5 or 80% of mines are loss making and have been for several years. You might wonder, are these guy stupid? Why are they digging stuff out of the ground if they are losing money? And who are the shareholders who keep funding the rights issues? Not just Lonmin but also other big players like Impala Platinum and Sibanye?
The answer to the last question is the South African Public Investment Corp – that is the South African civil servants pension fund. If capitalism worked the way the text book theory say it works, then Lonmin, which has one of…

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