Who is this for: Investors looking to make explosive profits with time horizons of multiple years
What is this for: Exchange of ideas for how to position a portfolio for the next bullish cycle in uranium
Why? After 30 hours of preliminary research, I have a strong feeling that we are on the cusp of the next Uranium bull market and would like to share some of the research and sources I have found as well as gather information from the collective knowledge of stock gumshoe members about how others are positioning their portfolios and companies which look especially appealing.
Here is what got this whole journey started: https://www.youtube.com/watch?v=gfvAIor53Ig
I HIGHLY recommend anybody considering uranium to watch the above 22 min video by Michael Alkin. Michael has spent nearly the last 20 years in the hedge fund industry. He has worked for a few multi-billion dollar hedge funds. During his career, he has been an analyst, portfolio manager and partner. He has been a dedicated short-seller, managed both a long and short portfolio and at times have been responsible for several hundred million dollars of capital.
Here is another good video about the strategy I am trying to employ with the uranium sector: https://www.youtube.com/watch?v=7SW96tD9Kdg&feature=youtu.be
This is the one proven way to make money in the natural resource sectors, these industry’s are cyclecar. As Warren Buffet says, your job is to pick the what. What will go up. Getting the timing exactly is extremely hard. I don’t know if the bull market has just started: spot prices are up over 20% as we speak or if it will take another couple years. All I know is that the bull market has not happened in the last 7 years and the fundamentals of the story are only improving
I recommend following John Quakes on twitter @Quakes99 for more uranium information as well. He shares a lot of good articles and resources and is very generous with his insight. I have had multiple conversations with him.
and last but certainly note least here is a uranium report: https://t.co/bjeLXHpg7M by Swiss resource capitol. GREAT COMPANY SUMMARIES AND EASY WAY TO START THE DD process.
my current portfolio: $UEC, $UUUU, $FCU, $SHY. Uranium currently makes of 8.2% of my overall portfolio. I am looking to increase this weight to 13.4% as I gain more confidence in the company landscape. There are only about 40 companies in this space and an estimated 10 quality names, excited to hear others insights and I have some more resources to share if this microblog becomes active.
This is a discussion topic or guest posting submitted by a Stock Gumshoe reader. The content has not been edited or reviewed by Stock Gumshoe, and any opinions expressed are those of the author alone.
Would love to know your take on anfield resources.High risk/reward play?
Here are my notes on Anfield – ANDLF owns Shootaring Canyon Mill (Utah) one of three in US, 4.1 M&1 velvet wood mine in utah (4.5 mil ib). 41% IRR both from Uranium One. Want to get up to 1,500,oo pounds of uranium per year production 1 mil through conventional mine restart and refurbishment. $75,000,000 gross at $50 uranium. Lowest M&1 12 mil ibs in resources. Considers themselves a producer.
Concerns – hard to raise money at a $6 mil MC. Can they execute without capitol?.
Insiders owns 12%, US energy Corp owns 45% (no mining related assests will probably look to liquidate MC 7 mil) (now 19% with recent dilution)
Paid 6 million for 24 ISR projects in Wyoming. Secured tradional past producing mines YR, MAG, Alamosa. Currently 8,299,000 pounds not including Red Rim, South Sweetwater, Clarkson Hill, Frank M and Findlay Tank
Clarkson Hill:
Inferred Mineral Resource of 957,000 tons with an average grade of 0.058 % eU3O8, estimated to contain 1,113,000 pounds of eU3O8.
Red Rim:
an Indicated Resource of 336,655 tons of mineralized material with an average grade of 0.170% eU3O8 (equivalent to an Indicated Resource of 1,142,449 pounds of eU3O8); and
an Inferred Resource of 472,988 tons of mineralized material with an average grade of 0.163% eU3O8 (equivalent to an Inferred Resource of 1,539,447 pounds of eU3O8).
currenlty waiting on nine mile
24 ISR-amenable assets with a historical resource of ~37 million pounds in September 2016. (??) Not in company presentation.
One of the overlooked assets in its asset base is a royalty portfolio that it acquired during the September 2016 transaction with Uranium one.
-2% to 4% sliding scale production royalty on Azarga Uranium’s (TSE:AZZ) Dewey Burdock project in Custer and Fall River Counties, South Dakota
-2% NSR on Western Uranium’s (CNSX:WUC) San Rafael project in Emery County, Utah
-2% to 4% sliding scale gross value royalty on Energy Fuels’ (TSE:EFR) Whirlwind project in Grand County, Utah.
-1% royalty on Energy Fuels’ (TSE:EFR) Energy Queen project in San Juan County, Utah.
The royalties are all on established projects, and will offer enormous torque. The Dewey Burdock project is the most advanced and the royalty is conservatively worth CA$4.1 million at current uranium prices. Compare this to Anfield’s current market cap of C$8.2 million
Concern – alot going on at alot of different places. Continued Dilution and selling from major shareholder. Expensive to become small producer. Might be cheap for a good reason. Non-ISR that aren’t in the Athabasca basin don’t make a whole lot of sense unless uranium prices is 2x atleast of where it is now. Small mine thesis of growing organically extremely hard to exicute.
Small mines have same amount of probelms that big mines do but not the same upside.
Reason to invest – If shared UEC’s valuation factor, (4 mil pd peak production, $50 uranium $200,000,000) Anflield would be worth $75,000,000 in todays climate. In a bull market, they would have a premium. Anfield has managed to bypass the long lead times associated with advancing to production through both the acquisition of an existing mill in Utah and an RPA signed with Uranium One to use its existing processing plan. (this is not really reflected in the price in my opinion.)
So interesting company. Don’t know if I am sold on a small producer. A lot needs to go right for them and the potential is inheriantly somewhat lower than other plays in th space. None of the big mining investors I follow seem to be invested here. Will they do well in an explosive bull market, sure. I think we will have a progression to $60 by 2019 and hit another leg up from there. they certainly are cheap though so the upside could be sharp if they do. Lots of operational and finiancial risk in my opinion. They need to get that MC up in a hurry. Diluating by 50% doesn’t make many friends
This will be interesting thread Levbrans, great timing. Speaking of timing, congrats to HN on his UEC purchase earlier this week!
I’ve been waiting for this thread as all these EVehicles have to get electricity from somewhere…..it just makes sense.
cheers
Glad to have you on bored Lulu. Very interesting space. It really does just make sense. Miners/producer can’t/won’t produce at a loss. The cure for low prices are low prices. The timeline is hard to know precisely but supply and demand will get out of balance in the next cycle. Mines take years to build and permit
Right now the 5 year contracts signed in 2012 are paying around $40 a pound. This number will continue to decrease as 2018 comes around into 2019. Supply side has taken 14% off the market and I would not be surprised if the Kazaks take some more off. US recently cut their selling on the spot market by 50% from 8 million pounds to 4 million.
Uranium is a GROWING industry at 3% year.
As michael Alkin says “the most asymmetrical risk/reward he has seen in his career”.
Was watching some rick rule on YouTube and he was talking about his love for project developers who do JV’s. Take advantage of intellectual property and sell the physical. Trying to get a grasp of what names in the uranium space fit this model.
I know skyharbor is somewhat taking in the mold. Need to see if any others in the space are. Marin Katusa is big on this name. Denison is also a large shareholder.
Dension is another company I have trouble getting a good valuation for. Have a lot of different things going on
$FCU $URE $DML Long In the red and holding
FCU is a great project. I have heard the analyst at eight capitol who is covering them is predicting 60% increase in uranium resources on their next update which should be coming any time now which would obviously be a huge catalyst.
Interested in hearing your thoughts on the particular merits of $URE and $DML that drew you to those names. URE looks like what anfield wants to become. ISR is an outstanding technology. Their production is dirt cheap.
Hi Levbrans,
Thanks for starting this thread. Uranium is sort of an afterthought on the Hard Asset thread, but when it starts to move up I think it will be an important topic.
For my own purposes I have reduced my uranium holdings to a few very leveraged
small caps that I think will get my attention when the price starts to move. Then I want to have a list of the best prospects that are good targets for additional capital.
I may miss a little of the first move this way, but the trade-off is that I do not have a lot of capital tied up for an indeterminate period. I sat with a losing position in CCJ for several years and finally dumped it last year as the opportunities in resources were too tempting to ignore.
$UEC Anyway, my current holding is UEC, This is a full position and when U308 starts to move, I will notice the price of UEC which will be very leveraged. It is an alarm clock.
$KVLQF The other uranium-related holding I have is Kivalliq Energy. This is a Canadian explorer, unlikely to ever produce anything. Very cheap market cap and stock price six or seven cents. This is not a pure U play, but one of their prospects is highly prospective in uranium. I also like their partners and affilated companies that have been interested enough to do deals with them…Commander Resources, and Sandstorm Gold. Obviously this is a discovery speculation.
$CCJ…large cap miners suck but when U starts to move there is no reason not to re-enter CCJ. There will be a stampede to this stock as it is the major listed option for bigger and mass investors.
$UUUU and $FCU also will consider when the time comes.
See also separate post on $GVXXF.
$GVXXF…Goviex…Goviex is one U stock I may pull the trigger on before a clear move in U308 prices. This is a nano-cap speculation with properties in West Africa.
It is the rawest kind of discovery speculation; the reasons I may go in early:
The principal of Goview is Govind Friedland, the son of Robert Friedland.
Besides whatever Govind has learned by Daddy’s upbringing, thinking, and education, this means that Goviex will have access to the technology, capital, and know-how of Robert Friedland, HPX, and Cleanteq.
This is pretty awesome support. It means that most of the risks other than discovery and jurisdiction risk are greatly mitigated. Govind may not have a great deal of experience, but you know that he is exposed to, and has the total support of, the absolute best mining mind and talented executive on God’s earth.
There is the risk of nepotistic subjectivity, but it might not matter if Goviex has deposits worth developing.
You can be sure that Robert Friedland will take an interest in the success of the enterprise. This is rare and valuable. If there is a good deposit there, Goviex will find it and it will be developed at an opportune time.
Thanks for stopping by Hendrix! Love the work your doing in the hard assets thread. I’ve read a little bit on Goviex and thought of you immediately when I looked at it. That Friedland connection is certainly not to be overlooked and hard to quantify its worth but I think its a lot more than people think.
An interesting note about UEC that I will be researching… how much is that titanium mine in peru worth??? seems to be absolutely ridiculously big mine but I have no background in the titanium space so will need to do some digging.
another fun tidbit.. Gold Mining Corp formally brazil resources which Amir Adnani started owns a major uranium exploration project… in the Athabasca basin, not sure how but I’m sure that was not unintentional. Not sure if he plans to move that project to UEC somehow but either way I’m invested in both companies and that property is very interesting exploration property!
Will be looking more into those names Hendrix so thanks for bringing them up. Explorers are tough. Hard without being a geologist to really separate what is what. Like the JV model and having multiple properties and locations. Might try putting together a basket of quality explores at some point.
Good call on Gold Mining Inc.
I went long a while back on BRIZF on account of the Athabasca prospect. I did not like their gold prospects and even now think it is more merchandising to attract retail capital. Sold it off when better prospects arose in metals, but would look at it again as a stealth uranium play if we don’t have to pay too much for the gold.
$Cameco Corporation (NYSE:CCJ) (TSX:CCO); $Kees Dekker.
Kees Dekker, the mining engineer whom I mentioned in a couple of posts on Hendrix’s thread (GOLD, SILVER, COPPER, AND HARD ASSETS…FALL 2017) has recently produced and circulated to his followers a report on Cameco which comprises a detailed study of the uranium market followed by a review of Cameco’s prospects. The report runs to some 35 pages.
As I’ve mentioned in the past Kees is always happy to have additional followers to read his reports and, if you’d like copies of the Cameco and future reports (gratis), email him on keesdek@gmail.com. I’m buying some Cameco shares as an intended long-term investment. Most of my current long-term investments are short-term investments gone wrong so this will be a change!
I set out below the email from Kees which accompanied his report.
Best wishes Michael.
_________________________________________
Copy of email from Kees Dekker to his followers.
Dear Followers,
I concluded my covering words in an e-mail introducing my previous article, the valuation of Endeavour Mining, with the statement that I needed to make an effort to find a subject where I could come to a positive conclusion.
For that subject I had to look beyond the precious metals sector and I had to complete a study that is quite different from my normal valuations. No cash flow forecast based on life of mine plans, but coming to a conclusion based on a commodity price turn-around. As an ex-Group Economist of Gold Fields of South Africa I am very sceptical about metal price forecasting and usually avoid that. Nobody can forecast prices accurately and people who got it right once invariably are wrong the following period. There are too many variables to be able to forecast a price for a particular period. That is not to say that one cannot see forces at work that will drive a commodity price in a certain direction. It is just so that the exact timing is impossible to forecast.
I am of the opinion that there are important forces at work that will move the uranium price upwards in the next 1-3 years. The nature of the uranium market is such, that when this occurs, it will have a sharp upward trajectory.
Cameco is one of the very few large listed pure uranium plays with producing mines. Its mines are the largest and richest in the world, located in a very safe jurisdiction. It is a market leader that has recently taken actions to jolt the uranium price upwards by announcing the temporary closure as of end January 2018 of the largest uranium mine in the world: McArthur River. In addition AREVA has announced important production reductions in 2018 at its mines in Niger.
The attached study has estimated the cash generative capacity of Cameco under various spot price scenarios. The 2018 financial year will see poor profits combined by good cash generation from monetising the very large uranium concentrate inventory, which will be replacing uranium oxide production from McArthur River to meet sales commitments.
Any upward movement in the spot uranium price in the next two years will translate in excellent cash flow for Cameco. The study concludes that a return to historical price levels of C$40 is not farfetched. It can take a few years, but when a price three- to fourfold, such a wait is worthwhile. That said, the share is not without its risks. It has a very large contingent tax liability should it lose its case with the Canadian tax authorities. Therefore not a share for widows and orphans. Note that my title comes with a question mark.
I like the risk/return relationship and have taken a position.
It should be noted that since I started my analysis on 16 November the price has risen 9%. It seems others are also taking a liking.
As always, comments, criticism and compliments are welcome, as is any New Follower.
kind regards
Kees Dekker
I have owned DNN for years.
By July 2019, the bitcoin network will require more electricity than the entire United States currently uses https://www.wired.com/story/bitcoin-mining-guzzles-energyand-its-carbon-footprint-just-keeps-growing/?
https://twitter.com/WIRED/status/938419080528302085 #GeauxNuclear!
Hi U followers,
I am thinking about expanding my position in the uranium space and will be doing some DD on a few tickers.
I have positions in UEC, a developer, and KVLQF, a long-shot exploration play.
I am favorably inclined towards CCJ but only when a move is clearly underway, I had my brains beaten in a couple times on it.
I posted on Goviex but am not persuaded, their expected costs make them viable only at very high U308 prices.
May I ask the followers here, what are your top picks, and why ?
I would prefer to stay away from exploration plays in this sector, on account of the fact that supply is not a problem in the sector. The faster a company can expand production, the better; so advanced development is OK, but producers with underutilzed production are better IMO.