EQ Resources Soars on Tungsten Buzz: Is the ASX Miner's Valuation Sustainable?

Sydney, Australia – In a dramatic rally that has caught the eye of the Australian resources sector, EQ Resources Ltd (ASX:EQR) has seen its share price surge more than 120% over the past month. The move comes amid a confluence of factors: a renewed strategic focus on tungsten as a critical mineral, significant operational updates from its flagship Mt Carbine project, and a recent increase in ordinary shares on issue. The question now facing investors is whether this momentum reflects a fundamental re-rating or speculative fervor.

The company, which last closed at A$0.185, now trades at a Price-to-Sales (P/S) ratio of approximately 13.2x. This valuation is notably richer than a closer peer group average of 4.4x, suggesting the market is attaching a significant premium to EQ Resources' sales. Analysts point to the broader context: tungsten's applications in aerospace, defense, and electronics have bolstered its geopolitical and economic profile, potentially justifying higher valuations for producers with credible assets.

"While the industry average P/S in Australian Metals and Mining sits at a lofty 146x, making EQR appear cheap by comparison, the more relevant benchmark is its direct peers," noted a market analyst. "The premium indicates high expectations for future cash flows from Mt Carbine that aren't yet reflected in earnings." The company reported revenue of A$66.33 million against a recent loss of A$39.31 million, highlighting the speculative nature of the current valuation which hinges on project execution and sustained tungsten demand.

Market Pulse: Voices from the Floor

"This is a classic resources story—speculation running ahead of reality," says Marcus Thorne, a portfolio manager at Horizon Capital. "A P/S of 13x for a loss-making miner, even in tungsten, is difficult to square with fundamentals. The moment macro sentiment shifts or project timelines slip, this could unwind sharply."

"The market is finally recognizing the strategic value of a non-Chinese tungsten supply chain," argues Dr. Anya Sharma, a resources strategist. "Mt Carbine is one of the few significant tungsten assets outside China. The premium isn't just about current sales; it's an option on future supply security. The recent capital raising provides the fuel to accelerate development."

"ARE YOU KIDDING ME? This is a pump waiting for a dump!" exclaims Rick 'Bear' Barlow, an independent trader known for his blunt commentary. "122% in a month on project 'updates' and hype? They lost $39 million last period! This isn't investing; it's gambling on a tungsten-themed meme stock. The insiders are the only ones getting rich here."

"As a long-term holder, the volatility is nerve-wracking, but the thesis is intact," shares Eleanor Chen, a private investor based in Perth. "The operational progress at Mt Carbine is tangible. The recent share issuance was for growth, not survival. If they deliver on the projected scale, today's price will look cheap. It's high-risk, but the potential reward matches it."

The road ahead for EQ Resources is fraught with both opportunity and risk. The company's ability to transition from a story stock to a profitable producer will depend on flawless execution at Mt Carbine, stable or rising tungsten prices, and continued geopolitical tailwinds for critical minerals. For now, the market's verdict is clear: it's betting big on tungsten, and EQ Resources is its current vehicle of choice.

Disclaimer: This analysis is for informational purposes only and does not constitute financial advice. Investors should conduct their own due diligence.