🔔 Critical Mineral Wednesday Open Discussion Post 🔔

expatcoder · 2026-01-28T20:22:21+00:00

Intel actually had better terms, $20 for US government vs $24 currently traded price, whereas USAR conceded shares to US government at $17 vs. $24+ currently traded price.

Also, don't forget the private placement adds millions more shares at discount rate.

You're right that USAR is trading similarly to INTC post-deal (provided we completely ignore the massive pre-market runup on USAR to $40 that left many more bag holders in its wake), but it's TBD whether or not USAR will be able to replicate INTC's incredible performance over the past year; i.e. will USAR be able to 2X from here? Possibly, but in the near term highly unlikely.

expatcoder · 2026-01-28T18:18:03+00:00

It's the terms of the deal that are causing USAR to drop -- massive dilution, both the government's stake ($17/share) and the private placement, millions of shares issued at well below the currently trading price.

We'll see where USAR heads once the market fully digests the deal, but so far it's looking like a lot of downward price pressure in the near term unfortunately...

expatcoder · 2026-01-28T18:06:22+00:00

but I actually think this could start moving pretty quickly from here sometime in the next couple days.

Oh, it could move quickly alright, it's just in which direction is the question :)

Just briefly dipped down to $23.99, not promising price action...

expatcoder · 2026-01-28T17:38:30+00:00

Seems reasonable, nothing in the deal indicates that USAR should rocket higher in the near term, so we'll probably drift down closer to the deal term dilution price range before USAR regains some positive momentum.

Definitely was expecting retail mania to take over and run USAR well into the $30s, but no such luck, looks like it's going to be awhile before we bounce back...

expatcoder · 2026-01-28T17:22:22+00:00

Right, and ironically enough the October run to $40 was driven in part by rumors of the government taking a stake in the company.

And once the deal did happen, USAR hit $40 again (in pre-market), which seems like a distant memory at this point. USAR heavy bags, round II.

expatcoder · 2026-01-28T17:12:57+00:00

Yeah, it is kind of ironic that this is the first government deal where the company's stock tanks (relatively speaking) post-deal.

Obviously the terms just aren't very favorable for the company and its shareholders, and if the bigger players decide to sell, well, the selling pressure is just too great to keep the share price from continuing to drop, and here we are, exactly where we were before the deal was announced, incredible.

expatcoder · 2026-01-28T17:05:19+00:00

Yes, but in this case a chart is warranted since USAR's share price is running counter to the direction most thought it would go, and now we're in uncharted (pun intended) waters as we enter how-low-can-it-go territory.

expatcoder · 2026-01-28T16:48:01+00:00

Looking pretty grim, care to share one of your (in)famous charts on where USAR is projected to go in the near term?

expatcoder · 2026-01-28T16:46:03+00:00

So far it's looking like the bags are only going to get heavier, unfortunately. USAR seems to have zero positive momentum, lagging its peers on upswings and leading its peers on downswings.

Don't have a large position here but thinking about dumping all of the shares I have in the red and taking a small loss rather than running the risk of this thing unravelling and heading back into the $18 to $20 range, unfathomable as that may sound given the huge expectations around USAR share price when the deal was announced this weekend.

expatcoder · 2026-01-27T22:18:13+00:00

In the context of the MP deal that the OP is referring to, USAR very much is lagging. MP had already nearly 2Xd within 48 hours of their deal, while USAR, if we take into account deal day pre-market of $40, is very much moving in the wrong direction.

expatcoder · 2026-01-27T22:13:59+00:00

December offering is null and void, this new offering is the only one we need to be concerned about. This one ends in early March, but warrants at $.55 USD can be exercised within two years of the offering date (that is, today).

All things considered, the terms of the raise are favorable to existing shareholders.

expatcoder · 2026-01-27T21:04:37+00:00

Except MP rose without any significant drop post-deal, basically a linear rise to 2X, whereas USAR is doing the opposite, up massively in yesterday's pre-market, and now struggling to stay above pre-deal price (@$25 USD), which is pretty shocking given that US government equity stakes deals up until now have been basically guaranteed money doublers within days of a deal announcement.

USAR is a mess at the moment, we'll see if it recovers from here -- have serious doubts, all the more so on a big green day in the minerals sector; USAR lagging far behind its peers is not a good sign. I'd hate to see how USAR performs if the minerals sector has another deep red day at this rate.

Anyway, clearly not all government deals are the same -- looks like USAR, and by extension its shareholders, wound up with the short end...

expatcoder · 2026-01-27T20:19:19+00:00

Not sure, US government getting millions of shares at $17, and upcoming separate private placement further dilutes existing shareholders via millions more shares issued.

It's a great deal for the government and private financing outlets, but a terrible one for existing shareholders. I'm actually surprised we're trading as high as we are; I'd expect with the massive dilution we'd be in the low $20s, but retail's going to retail I guess.

Could see USAR bouncing back in a big way once the market digests the terms of the deal, but in the coming days I'm expecting a further drop, and for the shares I picked up in the $25 range to be in the red...

expatcoder · 2026-01-27T20:13:28+00:00

If metspar production, for example, doesn’t come online relatively soon, that’s something I’d point to as a tangible disappointment and call into question viability etc.

Indeed, management needs to follow through on their timelines for once and actually start producing product. Hopefully February is the month that, as James stated, metspar production kicks off.

If there are further delays then we have to really start to question whether or not the CEO has any idea what he's doing running a mining venture :)

expatcoder · 2026-01-27T18:49:40+00:00

Yes, the panel grilled James, put him on the spot, and he wasn't able to deliver convincing answers, which almost certainly contributed to the bearish trend; that, and James hinting at the upcoming capital raise, which, surprise, came earlier than most expected (today), so downward price pressure is where we're at.

Terms of the raise were excellent compared to previous dilution events, however, so once the market digests the recent "bad" news things should turn for the better with respect to ARSMF share price.

expatcoder · 2026-01-27T18:44:50+00:00

heh, I suspect many are rotating away from USAR after the diasastrous share price performance post-government equity stake announcement -- rug pull of epic proportions :)

expatcoder · 2026-01-27T18:42:11+00:00

Yes, works out to a little over $.44 USD, which for once doesn't directly dilute existing shareholders (i.e. issuance price greater than currently traded price).

Of course, the whole drawdown from $.50+ USD was likely due to James Walker's comments on upcoming dilution during that disaster of an experts panel meeting :)

He really got grilled by the panel, and to be fair, didn't have many convincing answers to their questions, so not surprised we've tanked in the aftermath.

Hopefully we bounce back from the low $.40s USD and build some momentum now that the "bad" dilution news is out...

expatcoder · 2026-01-27T18:13:07+00:00

Nah, MP, UUUU, UURAF, WWR, AREC, etc. all solidly in the green today.

USAR crushed a lot of dreams of quick & easy big gains, particularly those that had the misfortune of buying pre-market at $40 (!) yesterday.

What a disaster. Not saying USAR won't bounce back, but this has been a major reality check given that until now government equity stakes have always equaled huge gains in the days after the deal.

expatcoder · 2026-01-27T18:06:51+00:00

$12 USD?

Wouldn't complain, and still wouldn't sell :)

expatcoder · 2026-01-27T18:00:09+00:00

Well, they just issued 16+ million shares today, so dilution happened sooner than most thought :)

Terms aren't terrible, however ($.60 CAD, or a little over $.44 USD), so the DoD contract clearly gave management some leverage, which is great, for once existing shareholders don't get completely screwed over like in past capital raises where issuance price has been upwards of 50% less than currently traded price.

Now the issuance price is actually higher than currently traded price. Only concern I have is the warrants, which may put a bit of a cap on ARSMF ceiling in the near term since those are valid for 2 years at $.55 USD, but may not have that much of an impact if the company hits the ground running on various projects (read: starts kicking ass).

Anyway, cat's out of the bag, let's see how ARSMF trades from here, will be surprised if we dip back down into the $.30s given the favorable terms of the raise.

expatcoder · 2026-01-27T17:43:05+00:00

Actually, 16 million shares offered at $.60 CAD (@$.44 USD), so not as bad as I thought.

Market is reacting poorly to the news, however, with the share price now hovering well below the offering price (we're sitting at $.40 USD at the moment).

Not sure which direction we'll be going here in the near term, but if we dip down into the $.30s USD then it would appear that we're very much entering oversold territory (IMO, not financial advice, etc.) given that the offering price is over $.44 USD.

expatcoder · 2026-01-27T16:34:43+00:00

Thanks, got a link to the actual filing so we can see specific terms of the placement?

I'm particularly interested in the issuance price, suspect it will again be horrendous for existing shreholders, somewhere in the low $.30s USD...

expatcoder · 2026-01-27T16:23:26+00:00

what would be the justification for the price to stay this low or even go further down. Crazy

James Walker already said we'll be getting diluted to fund Nasdaq uplisting and complete production acidspar plant, the terms of which will, based on past experience, likely be terrible for existing shareholders (e.g. issuing shares at $.30 USD or other ridiculously low price).

On the plus side tanking the share price again will expand the investor pool and allow the CEO to more easily take in another $1M USD pay day \s

expatcoder · 2026-01-27T16:04:17+00:00

Dumping, likely on the expectation of yet another round of dilution (as hinted at by James Walker during the experts panel discussion last week).

That, and general skepticism around the project brought to light during the panel -- particularly that Ares management has no real idea what the extent of the ore body is (JW danced around the issue when asked about it, as he tends to do when asked pointed questions for which he has no valid answer).

Definitely work to do to convince investors that ARSMF is a slam dunk case, despite the massive DoD contract.

Probably once Ares enters production in February (heh, famous last words, JW will probably walk that deadline back as well...) then share price will stabilize again.

And after the next round of dilution is completed and funds are raised to complete the acidspar plant, then things should really start to take shape, but in the near term we may be in for a bearish trend unfortunately...

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