Topic: How To Invest

Q: Back in 2017, you recommended avoiding the KBLT (Cobalt 27) IPO and it turned out to be sage advice. The shares have now dropped considerably. Though there is still the risk that a new battery technology could upset the demand for cobalt, how do you view Cobalt 27 as an investment now?

Article Excerpt

A: Cobalt 27 Capital Corp., $3.94, symbol KBLT on the Toronto Venture Exchange (Shares outstanding: 85.3 million; Market cap: $331.9 million;, holds what is believed to be the world’s largest private stockpile of physical cobalt at over 2,900 tonnes. The company also owns a 32.6% cobalt stream on the Voisey’s Bay mine. (Streams are where the company pays cobalt producers an upfront payment in exchange for a share of future cobalt output.) In addition, Cobalt 27 owns 11 other cash royalties on cobalt production or streams. For centuries, cobalt has been used to give glass a blue or green tint. Starting in the 1900s, the metal has also been added to other metals to manufacture aircraft engine parts and other corrosion- and wear-resistant products. In its radioactive form, cobalt is used in the treatment of cancer. Still, it’s the metal’s use in making batteries—including lithium-ion batteries for electric vehicles—that has significantly increased its demand. Cobalt 27 first began trading on the Toronto…

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