Almonty Industries: Surging Revenue and Russell Entry Can't Shake a 31% Correction
Published on 06/27/2026 at 16:45 | Redaktion boerse-global.de
Almonty Industries' first-quarter results painted a company in transformation: revenue more than tripled to CAD 25.4 million, operating cash flow swung positive to CAD 9.7 million, and cash reserves swelled to CAD 259.9 million. Yet the stock closed the week at CAD 23.00, down 14% in five sessions and a full 31% below its April peak of CAD 33.35, as investors zeroed in on a towering dilution risk from a freshly issued convertible bond.
The USD 800 million note, placed on June 4 with a 2.25% coupon and maturing in 2031, was originally sized at USD 700 million but grew after institutional buyers exercised the entire greenshoe option. Proceeds are earmarked for the Sangdong tungsten mine in South Korea, where Phase 1 began processing 640,000 tonnes of ore per year in March 2026, yielding roughly 2,300 tonnes of tungsten concentrate annually. A second phase, due in 2027, would double throughput to 1.2 million tonnes, positioning Almonty to supply about 40% of the world's tungsten demand outside China at full capacity.
The dilution overhang is the central worry. With a market capitalization equivalent to roughly EUR 4.11 billion, the conversion rights embedded in the bond could deluge the market with new shares if the stock appreciates toward triggering levels. Management is racing to accelerate cash generation – the Q1 operating cash flow of CAD 9.7 million was a positive step, but the company needs to lift those earnings substantially to offset the weight of future equity. The net loss of CAD 5.3 million was almost entirely driven by non-cash revaluation effects on derivatives and warrants, offering little immediate relief.
Should investors sell immediately? Or is it worth buying Almonty?
On the supportive side, geopolitical tailwinds are building. Starting January 1, 2027, new U.S. defense procurement rules ban tungsten sourced from China and Russia, creating a supply vacuum that Sangdong is designed to fill. Almonty has already relocated its corporate headquarters to Dillon, Montana, and acquired the nearby Gentung tungsten project, which is expected to reach production-readiness in the second half of 2026. The company is also drilling on an adjacent molybdenum property, with about 37% of the planned 26 holes completed and grades confirming historical results.
Another structural catalyst arrives at the end of June when Almonty joins the Russell 1000 and Russell 3000 indices. These benchmarks track roughly USD 12.2 trillion in assets, meaning index funds and ETFs will be forced to buy shares. The forced buying could provide a floor under a stock that has fallen through its 50-day moving average of CAD 26.78 and its 100-day line of CAD 25.05. The relative strength index of 40.9 signals mildly oversold conditions, though not yet a conclusive turning point.
Technically, the stock now needs to defend its 200-day moving average at CAD 18.04 to preserve the long-term uptrend – a further 27% decline from current levels. The 52-week high of CAD 33.35 sits 31% above the market, but the path back depends almost entirely on Sangdong's third-quarter performance, when management expects to reach full capacity. Any delay could trigger a deeper selloff, with the psychological CAD 20 level acting as a key support. The stock's annualized volatility of 91% ensures the ride will stay rough.
Despite the near-term pain, the shares have still gained nearly 300% over the past twelve months and are up more than 91% year-to-date. Bulls view the current correction as a healthy consolidation within a secular uptrend driven by critical mineral demand. The next decisive catalysts are the third-quarter production report and the final weight determination in the Russell indices. For now, Almonty remains caught between a dilutive financing and a once-in-a-cycle opportunity – and the market is waiting to see which force prevails.
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Almonty Stock: New Analysis - 27 June
Fresh Almonty information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
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