To The Moon

# TMC The Metals Company (NASDAQ: TMC) — Full Technical & Fundamental Analysis Thesis

**Date:** 18 March 2026 | **Analyst:** Nik | **Catalyst:** Q4 2025 Earnings — 19 March 2026 AH

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## Executive Summary

TMC the metals company (NASDAQ: TMC) is a pre-revenue, development-stage deep-sea minerals explorer with a market capitalisation of approximately $2.5B, trading at $6.07 against a 52-week range of $1.57 to $11.35, implying a peak-to-trough drawdown of roughly 46% from highs. The stock is a pure-play regulatory and permitting binary — not a traditional earnings play — meaning that fundamental valuation models anchored to discounted cash flow or EV/EBITDA multiples are largely ineffective at this stage of the business lifecycle. Price action is instead driven by newsflow, options gamma, short-squeeze dynamics, and macro sentiment around critical minerals supply security.

The bull thesis rests on three pillars: (1) a Trump administration tailwind via Executive Order 14285 expediting NOAA permitting under DSHMRA, (2) an estimated combined NPV of $23.6B across NORI-D and TOML-F projects representing a massive resource value gap versus current market cap, and (3) a 6:1 call-to-put ratio in the options market reflecting strongly bullish directional conviction. The bear thesis centres on zero revenue, structurally negative operating cash flow, an ISA jurisdictional conflict that could invalidate unilateral U.S. permitting, and a Q3 2025 EPS miss of -$0.46 versus the -$0.05 consensus that caused an 8.33% post-earnings gap down.

**Position context:** Long 1,200 shares at $6.30 average, short 10x $6.50 call contracts expiring 20 March 2026, net unrealised P&L of -$153.21 on stock, +$230.10 on calls. This is a covered call structure with upside capped at $6.50, representing a theoretical max gain of roughly $0.63/share or approximately $756 on the full position.

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## Part 1 — Technical Analysis

### 1.1 Price Structure and Trend Classification

TMC is currently trading in a **post-distribution downtrend** following its January 23, 2026 pivot top, from which the stock has fallen approximately 46.5% to $6.07 as of today. On a weekly timeframe, the stock has formed a series of lower highs and lower lows since that pivot — the classic hallmark of a markdown phase in Wyckoff cycle terms. The intermediate trend is bearish. The short-term trend is consolidating with indecision candles forming around the $5.90–$6.20 range, suggesting a potential phase of accumulation or basing ahead of tomorrow’s earnings catalyst.

The 52-week high of $11.35 established in January 2026 was driven by momentum from the HC Wainwright price target upgrade to $11.75, retail speculative flow, and the initial NOAA rule publication. Since that pivot top, the stock has retraced to exactly the $6.07 area, which represents approximately the 61.8% Fibonacci retracement of the August 2025 lows to January 2026 highs — a textbook golden ratio retracement level that often acts as a magnet for price in trending reversals.

### 1.2 Key Support and Resistance Levels

|Level |Type |Notes |

|------|-------------------|---------------------------------------------------------------|

|$11.35|Major Resistance |52-week high, prior pivot top, January 2026 |

|$9.81 |Resistance |Consensus analyst price target (4-analyst average) |

|$7.11 |Resistance |Volume-weighted resistance cluster, near 50-DMA |

|$6.50 |Resistance / Strike|Short call strike, also coincides with prior consolidation zone|

|$6.27 |Resistance |Volume node from prior accumulation |

|$6.07 |Current Price |Trading at this level, critical battleground |

|$5.65 |Support |Accumulated volume support identified from VWAP anchoring |

|$5.42 |Support |Secondary support, next level on a break below $5.65 |

|$5.35 |Support |Tertiary support, coincides with prior consolidation low |

|$1.57 |Major Support |52-week absolute low, long-term floor |

The $5.42–$5.65 range is a high-conviction support cluster. Multiple volume nodes from prior accumulation phases are stacked in this zone, and a break below $5.35 on meaningful volume would likely trigger a momentum flush toward the $4.00–$4.50 range where the next significant volume shelf sits.

### 1.3 Moving Averages and Trend Indicators

TMC’s moving average structure is bearish across most timeframes:

- **50-DMA** sits at approximately $6.86, currently acting as dynamic resistance. Price is trading below the 50-DMA, which is a bearish signal. Any break and close above $6.86 on elevated volume would be the first sign of momentum recovery.

- **200-DMA** is elevated well above the current price, reflecting the speed of the post-January drawdown. The death cross (50-DMA crossing below 200-DMA) that likely formed during this decline is a standard institutional sell signal.

- **3-month MACD** is in a sell signal configuration. The MACD histogram is negative, indicating that bearish momentum has not yet fully exhausted. A MACD crossover back above the signal line would be a meaningful early-stage bullish indicator to watch for post-earnings.

- **Short-term moving averages** (5-DMA, 10-DMA) are flattening, consistent with pre-event consolidation. This is typical of a stock that has front-run the earnings catalyst through position-building rather than continued directional momentum.

### 1.4 Volume Profile and VWAP Analysis

The volume profile over the past three months shows heavy traded volume between $5.65 and $7.00, creating a high-volume node (HVN) in that range. This HVN acts as a point of control (POC) — the price level where the most trading activity has occurred — and is consistent with the current price action consolidating in that zone. Low-volume nodes (LVN) exist above $7.11 and below $5.35, meaning that if the stock breaks out of the $5.65–$7.11 range, it is likely to move quickly to the next HVN.

Anchored VWAP from the January 23 pivot top currently sits near $7.40, well above market. All buyers from the peak distribution phase are underwater, creating a significant overhead resistance layer of trapped longs who may sell into strength. This dynamic suppresses rally attempts unless a catalyst is strong enough to absorb that supply.

On a rolling 30-day basis, average daily volume is approximately 8–12 million shares. On earnings days, TMC has historically seen 2x–4x its average daily volume, which given the illiquidity of the name above $7.00 can create extreme intraday price dislocation.

### 1.5 Implied Volatility and Options Market Structure

The options market is pricing in an 11.4% move in either direction post-earnings, translating to approximately $0.69 in dollar terms from the current $6.07 price. This gives implied move ranges of:

- **Upside scenario:** $6.76 (breaches your $6.50 short call strike)

- **Downside scenario:** $5.38 (approaches the $5.42 secondary support)

- **Historical median:** 4.0% over the past eight quarters, roughly $0.24

The 6:1 call-to-put ratio in pre-earnings options flow signals directional bullishness from market participants, not a pure straddle/strangle vol play. This suggests that smart money or informed buyers are making directional bets on upside, not merely hedging tail risk. That ratio is elevated relative to a name of this volatility profile.

Implied volatility (IV) is elevated relative to historical volatility (HV). The IV/HV spread (IV crush premium) means that any options held through earnings will see significant theta decay and vega collapse post-event regardless of direction — IV typically compresses 30%–60% post-announcement in high-IV names like TMC. This is why your short call position at $0.30 is now worth $0.07: the market has already partially priced in a vol crush on the short-dated March 20 expiry. By tomorrow close, that extrinsic value will be near zero.

**Max pain for the March 20 expiry** is likely to be in the $6.00–$6.50 range, which is where the maximum number of options expire worthless for both buyers and sellers. Given the stock is sitting right at $6.07, this is consistent with a gravitational pull toward the strike cluster.

### 1.6 Relative Strength and Sector Comparison

On a relative basis, TMC has significantly underperformed the broader critical minerals and rare earths sector since its January 2026 peak. Peers including MP Materials Corp, Lithium Americas Corp, and USA Rare Earth have also pulled back from sector highs, but TMC’s 46% drawdown from peak is among the steepest in the cohort. This reflects the company-specific overhang of the NOAA permitting timeline uncertainty, the Q3 EPS miss, and the natural mean-reversion from a stock that had already surged over 800% year-to-date into its January high.

TMC’s beta of 1.82 confirms that this stock moves approximately 1.82x the market in both directions. In a risk-on environment (which the current call/put skew implies), beta amplification works in bulls’ favour. In a risk-off macro environment, it is a significant liability. Given current macro conditions — with tariff uncertainty and Fed rate policy in flux — the beta exposure is a meaningful risk factor that cannot be ignored in position sizing.

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## Part 2 — Fundamental Analysis

### 2.1 Business Model and Stage of Development

TMC is a pre-commercial-stage minerals explorer, headquartered in Vancouver, Canada, focused on the collection and processing of polymetallic nodules from the seafloor of the Clarion-Clipperton Zone (CCZ), located approximately 1,300 nautical miles southwest of San Diego. The company was founded in 2011 and listed via a SPAC reverse merger with NPV Acquisition Corp in 2021. It currently has 47 employees as of March 2026.

The core business model is vertically integrated extraction: TMC holds three ISA exploration contract areas in the CCZ, with sponsorship agreements through Nauru Ocean Resources Inc (NORI) and Tonga Offshore Mining Ltd (TOML). The polymetallic nodules targeted contain four critical battery metals — nickel, copper, cobalt, and manganese — at ore grades of approximately 1.4% nickel, 1.2% copper, 0.2% cobalt, and 31% manganese. The CCZ is estimated to contain more cobalt, manganese, and nickel than all known terrestrial land deposits combined, making this one of the most significant undeveloped resource endowments in the world.

Commercial production is targeted for Q4 2027, contingent on receipt of a commercial recovery permit from NOAA under DSHMRA. Steady-state production is projected to commence around 2031, with annual output of 97,000 tonnes of nickel, 70,000 tonnes of copper, 7,400 tonnes of cobalt, and 2,389,000 tonnes of manganese at a production rate of 10.8 million wet tonnes of nodules per year.

### 2.2 Income Statement and Revenue Analysis

TMC is definitively pre-revenue. Total revenue for the nine months ended September 30, 2025 was $0.00. This is expected to remain $0.00 through FY2026 and likely into FY2027 pending permit receipt. Revenue forecasts for Q4 2025 (tomorrow’s report) are also consensus $0.00.

Net loss for the nine months ended September 30, 2025 was $279.45 million. However, the majority of this loss was non-cash and non-recurring in nature. The Q3 2025 net loss of $184.5 million (-$0.46/share) was dominated by a $131 million non-cash increase in the fair value of the royalty liability — a mark-to-market accounting item that inflates reported losses without affecting operational cash consumption. The comparable consensus EPS estimate was -$0.05, making the GAAP miss look catastrophic at face value. Stripping out the non-cash royalty fair value adjustment, the underlying operational burn is far more manageable.

Cash used in operations in Q3 2025 was $11.5 million — the number that actually matters for liquidity runway assessment. At that run rate, the company burns approximately $46 million per year in operating cash, broadly consistent with the reported trailing 12-month operating cash flow of -$45.21 million.

### 2.3 Balance Sheet and Liquidity Runway

As at September 30, 2025, TMC held $115.6 million in cash with no debt. Post-quarter, warrant exercises added approximately $5.4 million, bringing cash to ~$121 million and total liquidity to approximately $165 million inclusive of available credit facilities. Net cash per share at the Q3 balance sheet date was approximately $0.28/share.

At a cash burn rate of approximately $11.5 million per quarter, the company has a liquidity runway of roughly 14 quarters, or just over three years from September 2025. That takes the cash runway to approximately mid-2028, comfortably beyond the targeted Q4 2027 commercial production commencement date.

The key optionality on the balance sheet is the warrant overhang. Outstanding public warrants with an $11.50 exercise price expire September 9, 2026. If the stock trades above $11.50, these warrants would generate over $432 million in additional cash proceeds — transforming the balance sheet materially. At current price of $6.07, these are deeply out-of-the-money and will almost certainly expire worthless unless a significant re-rating event occurs before September 2026.

Capital expenditure is negligible at $190,000 trailing 12 months. Free cash flow is -$45.40 million, broadly equivalent to operating cash flow. Share count has increased 14.82% year-over-year to 413.49 million shares outstanding, reflecting warrant-driven dilution. Further dilution is a material risk if the company needs to raise additional capital through equity issuance prior to permit approval.

### 2.4 Valuation and NPV Analysis

Traditional valuation frameworks do not apply cleanly to TMC at this stage. The company has no revenue, no EBITDA, no price-to-earnings ratio, and no meaningful book value relative to the mineral resource endowment. Price-to-book and EV/EBITDA multiples are therefore not useful. The appropriate valuation methodology is resource-based NPV analysis anchored to the Pre-Feasibility Study (PFS) economics.

Key PFS metrics for NORI-D (the primary project area):

|Metric |Value |

|--------------------------------------------|-------------------------------|

|Probable Mineral Reserves |51 million tonnes (wet nodules)|

|PFS NPV (8% discount rate) |$5.5 billion |

|Combined NPV (NORI-D + TOML-F) |$23.6 billion |

|Steady-state EBITDA margin |~43% |

|Projected revenue per dry tonne |$600 |

|Annual production at steady state |10.8 Mt wet nodules |

|Steady-state annual nickel output |97,000 tonnes |

|Steady-state annual cobalt output |7,400 tonnes |

|Consolidated application area (Jan 2026) |65,000 km2 |

|Estimated total resource in application area|619 Mt wet nodules |

At the current market cap of approximately $2.5B, the stock is trading at roughly 10.6% of the combined NPV of $23.6B. If you apply a typical exploration-stage risk discount of 85%–90% to that NPV to account for permitting, execution, and timeline risk, you get a risk-adjusted NPV of approximately $2.36B–$3.54B, which brackets the current market cap reasonably. This suggests the market is pricing in approximately an 85%–90% probability-weighted discount to the full NPV — reasonable given the permitting binary still unresolved.

The consensus analyst price target of $9.81 (average of 4 analysts, Strong Buy consensus) implies a 61.9% upside from current levels. The HC Wainwright target of $11.75 implies 93.6% upside. The Wedbush Buy reaffirmation on March 10, 2026 adds conviction to the sell-side bullish narrative, though all price targets carry the caveat of permit receipt as a precondition.

### 2.5 The Regulatory and Permitting Overhang — The Binary That Drives Everything

The single most important determinant of TMC’s valuation trajectory is not earnings — it is permit receipt. The entire investment thesis lives and dies by the NOAA DSHMRA permitting timeline. Here is the full regulatory stack:

**U.S. pathway (primary):**

- April 24, 2025: Trump Executive Order 14285 — “Unleashing America’s Offshore Critical Minerals and Resources” directs NOAA to expedite DSHMRA permitting.

- April 29, 2025: TMC USA submits applications for two exploration licenses and one commercial recovery permit under DSHMRA.

- January 21, 2026: NOAA publishes final rule modernising DSHMRA regulations, including the new consolidated application and review process.

- January 22, 2026: TMC USA files the first-ever consolidated DSHMRA application, expanding commercial recovery area from 25,000 km2 to 65,000 km2 and estimated resource to 619 Mt.

- March 9, 2026: NOAA determines TMC USA’s consolidated application is in substantial compliance — the most recent material catalyst.

- **NOAA review timeline:** NOAA has a maximum of two years to evaluate applications, but given executive branch pressure under EO 14285, review is widely expected to conclude significantly faster. NOAA must complete environmental and technical evaluations under NEPA before any commercial recovery permit can be issued.

**ISA pathway (legacy, now secondary):**

- TMC holds two ISA exploration contracts through NORI (Nauru) and TOML (Tonga) sponsorships.

- The ISA has not finalised its mining code and its July 2025 session closed without a moratorium but with multiple unresolved issues.

- The ISA views unilateral U.S. permitting under DSHMRA as a potential violation of international law, creating a legal jurisdictional conflict between the U.S. domestic regulatory pathway and UNCLOS.

- 40+ countries as of December 2025 have announced opposition to seabed mining, including Canada, UK, France, and Germany. This geopolitical pressure creates headline risk even as U.S. regulatory momentum accelerates.

The core regulatory risk is that the U.S. DSHMRA pathway, being domestically valid but internationally contested, could face legal challenge from ISA member states, potentially invalidating or delaying a commercial recovery permit even after NOAA issues one. This is a non-trivial tail risk that is not fully priced into the current valuation.

### 2.6 Earnings Risk — Q4 2025 Report (Tomorrow, March 19, AH)

What to watch in tomorrow’s report:

|Item |Expected |Significance |

|-------------------------|--------------------------|-------------------------------------------------------------------------------------------|

|Revenue |$0.00 |Zero revenue is expected and priced in. No surprise here. |

|EPS (GAAP) |-$0.055 (analyst estimate)|Non-cash items could cause another large miss. Watch for royalty fair value mark-to-market.|

|Cash position |~$115M+ |Runway is the key metric. Any cash below $100M would be negative. |

|Operating cash burn |~$11–13M/quarter |Any acceleration in burn rate would be bearish. |

|NOAA permitting update |Key qualitative item |Any concrete timeline guidance or further compliance steps will drive the stock. |

|Warrant exercise proceeds|Unclear |Post-Q3 warrants added ~$5.4M. Any further exercises signal shareholder confidence. |

|G&A normalisation |Need to see it |Q3 G&A surged to $45.7M from $8.1M YoY. Need confirmation this was non-recurring. |

|Japanese nodule trials |Progress update |Hidden Gem vessel participation in Japanese trials is a credibility signal. |

The Q3 2025 EPS miss of -$0.46 versus -$0.05 consensus was the primary driver of the 8.33% post-earnings stock decline. However, the miss was substantially non-cash. If Q4 2025 includes another large royalty fair value adjustment, the headline GAAP EPS will again be a massive miss versus consensus. The market’s reaction will depend on whether participants understand the non-cash nature of the loss. Given that call/put skew is 6:1 bullish, the options market appears to have discounted this risk and is positioning for upside from a permitting update narrative rather than a clean EPS beat.

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## Part 3 — Macro and Thematic Context

### 3.1 Critical Minerals Supercycle Thesis

TMC’s entire market narrative is embedded within the broader critical minerals supply security debate. China controls over 90% of global processed rare earth supply and has progressively tightened export controls on battery metals. The U.S. government has explicitly identified nickel, cobalt, copper, and manganese — exactly the metals TMC targets — as critical to defence, energy transition, and advanced manufacturing. EO 14285 is not a standalone policy; it is part of a broader suite of executive actions designed to reshore and diversify critical mineral supply chains away from Chinese and geopolitically unstable sources.

This macro tailwind is structural, not cyclical. As long as the U.S.-China strategic competition continues to intensify — particularly around battery supply chains for EVs and defence platforms — TMC’s resource endowment becomes increasingly strategically valuable. The Pentagon has expressed interest in using the National Defense Stockpile as an offtake mechanism for nodule-derived minerals, which would effectively underwrite TMC’s revenue in early production years. That kind of government-backed offtake agreement would be transformational for the investment thesis.

The ISA CCZ nodule fields are ranked as the fifth and seventh largest nickel deposits in the world by combined reserves and resources. Ore grades of 1.4% nickel, 1.2% copper, and 0.2% cobalt compare favourably with the two largest producing nickel mines in Indonesia (Sorowako and Weda Bay). The resource quality is not in question. The only question is whether TMC can secure the legal and regulatory permission to mine it.

### 3.2 Geopolitical Risk Factors

The 40+ country opposition bloc to seabed mining creates a permanent geopolitical overhang. Key risks include:

- ISA enforcement action or formal legal challenge to unilateral DSHMRA permits

- Change in U.S. administration reversing EO 14285 (low probability near-term but a real 4-year risk)

- Environmental litigation under NEPA slowing or blocking NOAA’s permitting process

- European financial institutions or major end-users (auto OEMs) refusing to offtake nodule-derived metals on ESG grounds, reducing the available buyer pool

- China strategically supporting ISA opposition to delay U.S. critical mineral development

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## Part 4 — Position Analysis and Scenarios

### 4.1 Covered Call Position — Full Scenario Matrix

Given earnings AH tomorrow (March 19) with your $6.50 call expiring March 20:

|Scenario |Stock Move|Price at Expiry|Stock P&L|Call P&L |Net P&L |

|-------------------------|----------|---------------|---------|---------------------------------------|-----------|

|Bull case (NOAA update) |+15% |$6.98 |+$816 |Stock called away at $6.50, cap applies|~$756 net |

|Base case (permit update)|+5% |$6.37 |+$84 |Calls expire OTM ($0.00) |~$314 net |

|Neutral (in-line) |Flat |$6.07 |-$276 |Calls expire worthless (+$230) |-$46 net |

|Bear case (miss again) |-8% |$5.58 |-$864 |Calls expire worthless (+$230) |-$634 net |

|Tail risk (big miss) |-15% |$5.16 |-$1,368 |Calls expire worthless (+$230) |-$1,138 net|

The covered call provides meaningful downside cushioning through the $230 in premium already collected, but does not hedge a significant adverse move. Net breakeven on the combined position is approximately $6.11 — you need the stock to be above that tomorrow for the position to be profitable.

### 4.2 Risk-Reward Summary

- **Maximum upside** (covered call): ~$756 if stock closes above $6.50 at March 20 expiry

- **Breakeven:** ~$6.11

- **Maximum downside:** Uncapped on the stock below $6.11 minus the $230 call premium buffer

- **Probability of profitable outcome:** Given 6:1 call/put skew and NOAA compliance news, directional lean is upside, but 11.4% implied move in either direction means tail scenarios are material

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## Conclusion

TMC is not a stock you analyse in the same way as a traditional earnings play. It is a regulatory binary with a venture-capital-style risk profile embedded in a publicly traded equity. The resource endowment is world-class. The U.S. policy environment under EO 14285 is the most favourable it has ever been for the DSHMRA permitting pathway. The Q3 2025 EPS miss was non-cash dominated and does not reflect the operational health of the business. The balance sheet with $165M in liquidity and a $45M annual burn rate gives the company adequate runway to Q4 2027 production commencement.

On the technical side, the stock is in a post-distribution downtrend, trading below the 50-DMA and MACD sell signal, with price action consolidating at the 61.8% Fibonacci retracement of the August 2025 to January 2026 rally. The $5.65 support cluster is critical. A close below $5.35 would be a significant technical breakdown signal.

The earnings report tomorrow is a near-term binary: a bullish NOAA permitting timeline update or clean cash burn report could catalyse a 10%+ gap up directly into the short call strike zone. A GAAP EPS miss driven by another large non-cash royalty adjustment, without a positive permitting narrative, risks a retest of $5.42 support.

The options market is pricing this correctly: 11.4% implied move, 6:1 calls, and max pain anchored near current levels. This is a high-conviction macro and regulatory story trading at a deep discount to its NPV, with near-term technical weakness masking medium-term fundamental optionality that is extremely asymmetric.

**Overall thesis: Speculative Long | Regulatory Binary | Watch $5.65 support on downside, $6.86 (50-DMA) on upside. Immediate catalyst: Q4 2025 earnings and NOAA permitting update March 19, AH.**

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*This analysis is for informational purposes only and does not constitute financial advice. All figures referenced are sourced from publicly available financial data, SEC filings, and analyst reports as of 18 March 2026.*